Indonesia’s Global A W O R L D B A N K I N D O N E S I A R E P O R T Workers Juggling N O V 2 0 1 7 E M B E R Opportunities & Risks The World Bank Office Jakarta Indonesia’s Global Worker: For any questions regarding this Printed in November 2017 Juggling Opportunities and report, please contact: Indonesia Stock Exchange Risks is a product of the Photo Credits World Bank Building Tower II/12th Floor staff of the World Bank. The Ririn Salwa Purnamasari Jl Jend Sudirman Kav 52-53 findings, interpretations, and (rpurnamasari@worldbank.org) Jakarta 12910 conclusions expressed herein do not necessarily reflect the P (6221) 5299-3000 views of the Board of Executive F (6221) 5299-3111 Directors of the World Bank W www.worldbank.org/id or the Government they represent. The World Bank does The World Bank not guarantee the accuracy of the data included in this 1818 H Street NW Washington, work. The boundaries, colors, DC 20433, USA denominations, and other information shown on any map T (202) 458-1876 in this work do not imply any F (202) 522-1557/1560 judgment on the part of the W www.worldbank.org World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. Copyright Statement for Reconstruction and work, please send a request on rights and licenses, including Development/ The World Bank with complete information subsidiary rights, should be The material in this publication encourages dissemination to the Copyright Clearance addressed to the Office of the is copyrighted. Copying and/ of its work and will normally Center, Inc., 222 Rosewood Publisher, The World Bank, 1818 or transmitting portions or all grant permission to reproduce Drive, Danvers, MA 01923, USA, H Street NW, Washington, DC of this work without permission portions of the work promptly. telephone 978-750- 8400, fax 20433, USA, fax 202-522-2422, may be a violation of applicable For permission to photocopy 978-750-4470, http://www. e-mail pubrights@ worldbank. law. The International Bank or reprint any part of this copyright.com/. All other queries org. A Word from the Country Director Rodrigo A. Chaves Country Director, Indonesia and Timor-Leste The World Bank Over the past decade, Indonesia has achieved remarkable develop- for Indonesians to obtain work overseas. Thus, more than 9 million ment results. From 2006 to 2016, growth averaged 5.6 percent, pov- Indonesians are today employed abroad. More than three-quarters erty was reduced from 17.8 percent to 10.9 percent, and 23 million of them are low-skilled workers. new jobs were created. Nearly 83 percent, or 19 million, of these new employment opportunities were quality jobs with high wages. For While the increased labor migration reflects limited opportunities many Indonesians, these significant developments have meant more at home, migration can also have significant economic impacts prosperous lives and a transition to higher levels of economic security. both for individuals and for the Indonesian economy. Indonesian migrant workers earn up to six times more than they can at home, However, despite the fast pace of job creation and rising wages, and for 70 percent of migrants, working abroad is a positive experi- many Indonesians are at risk of being left behind in the quest for bet- ence that helps them improve their welfare. Migration also provides ter livelihood opportunities. And recent trends are worrying – since workers with an opportunity to gain skills and experience and, for 2015, Indonesia’s labor market has driven increasingly inequitable nearly 80 percent of female migrants, an entry point into paid work. outcomes, creating lower productivity jobs and less formal work. The impact of migration also extends to Indonesia’s economy: in While the number of non-agricultural self-employed and unpaid 2016 migrant workers remitted more than IDR 118 trillion (US$8.9 workers grew by 14 and 3 percent respectively since 2015, the num- billion), equivalent to 1 percent of Indonesia’s total GDP. ber of formal wage workers increased only 2 percent. This primarily affects low-skilled workers, of which Indonesia has many: around The issues concerning migration are complex, and to date empirical 60 percent of current workers have not completed high school and knowledge on migration has been limited. Indonesia still has ways cannot compete for the limited number of high-productivity jobs. to go to better facilitate efficient migration and to ensure both safe and more effective migration practices. This report, Indonesia’s The Government of Indonesia is increasingly focused on improving Global Workers: Juggling Opportunities and Risks, provides a solid opportunities for all its citizens to thrive and to benefit from the foundation for action. It is based on the first ever nationwide survey country’s remarkable economic growth. In 2017, President Joko of migrant workers, carried out in collaboration with BPS-Statistics Widodo declared that his main priority is to address inequality Indonesia and with the generous support of the Government of and ensure that Indonesia’s prosperity is shared by all. This is an Australia. The World Bank stands ready to support the Government encouraging and welcome step for Indonesia. of Indonesia, under the leadership of the Ministry of Manpower, to pursue policy reforms that better facilitate migration to reap its In the meantime, with limited work at home, low-skilled Indonesian potential and make it safer. This will make a difference not only workers turn to job opportunities abroad. Neighboring countries to improving the lives of these workers and supporting economic such as Malaysia, Singapore and the Republic of Korea, have trans- growth, but also contribute to Indonesia’s goals of creating a coun- lated economic growth into more employment, and with increased try where the benefits of growth and prosperity are shared with all. economic integration and reduced barriers to mobility, it is easier Page IV Indonesia’s Global Workers Acknowledgements Indonesian Global Workers: Juggling Opportunities and Risks was Strategic guidance and key comments were provided by Rodrigo prepared by the World Bank’s Poverty & Equity Global Practice team Chaves (Country Director, EACIF), Cristobal Ridao-Cano (Lead in the Jakarta Office. The team provides technical and policy advice Economist, GSP05, previously with EACIF) and Camilla Holme- based on sound empirical research and analysis to the Government mo (Program Leader, EACIF). Valuable comments were provid- of Indonesia to support its efforts in reducing poverty, vulnerability ed by peer reviewers: Ahmad Ahsan (previously Lead Economist, and inequality. Creating more and better work opportunities is one EAPCE), Soonhwa Yi (Senior Economist, GSP02), and Pablo Ariel of the key strategies towards these ends, which includes addressing Acosta (Senior Economist, GSP02). Useful inputs and suggestions the specific concerns surrounding international migrant workers. were also received from Ndiame Diop (Practice Manager, GMF10), Tatiana Nenova (Program Leader, SACSL, previously with EACIF), This report would not have been possible without the support and Gillian Brown (previously Principal Advisor, Australia Indonesia guidance of Hanif Dhakiri, Minister of Manpower, and the many Partnership for Economic Governance), Maesy Angelina (previously useful comments and insights from our government counterparts, Research & Innovation Manager, MAMPU), staff from the Australian more specifically Nusron Wahid, Head of National Agency for the Department of Foreign Affairs and Trade (DFAT), Matthew Grant Wai- Placement and Protection of Indonesian Migrant Workers (Badan Poi (Senior Economist, GPV05), Obert Pimhidzai (Senior Economist, Nasional Penempatan dan Perlindungan Tenaga Kerja Indone- GPV02), Christopher Juan Costain (Lead Financial Sector Specialist, sia, or BNP2TKI), Hery Sudarmanto (Secretary General, Ministry GFM02), Isaku Endo (Senior Financial Sector Specialist, GFM02), of Manpower), Maruli Apul Hasoloan (Director General of Labor Neni Lestari (Financial Sector Specialist, GFM02), Iene Muliati (Senior Placement and Employment Opportunity Expansion), Edi Pur- Social Protection Specialist, GSP02), Ilsa Meidina (Social Protection nama (Secretary of Director General of Labor Placement and Em- Specialist, GSP02), and Indra Budi Sumantoro (Consultant, GSP02). ployment Opportunity Expansion), Budi Hartawan (Secretary of The report has benefited greatly from these comments. Directorate General of Labor Inspection and Occupational Health and Safety, Ministry of Manpower), Soes Hindharno (Director of The analysis presented in this report were mainly based on the Placement and Protection of Indonesian Overseas Workers, Minis- World Bank Survey on Indonesia International Migration and Re- try of Manpower), Sri Setiawati (Division Head of Regional Cooper- mittance 2013/2014. This survey was conducted in collaboration ation, Bureau of International Cooperation, Ministry of Manpower), with BPS-Statistics Indonesia, in particular Wynandin Imawan, Aris Wahyudi (previously Director of Center for Labor Research and Razali Ritonga, Teguh Pramono, Nona Iriana, Rini Savitridina, Development, Ministry of Manpower) and team at the Center for Gantjang Amanullah, Krido Saptono, Tri Windiarto, Raden Sinang, Manpower Research and Development, Elia Rosalina (Deputy of Satriana, Eridawaty, Ika Luswara, Widaryatmo, Idha Sahara, and International Cooperation and Promotion, BNP2TKI), Teguh Hen- Piping Setyo Handayani. Valuable inputs and suggestions to the dro Cahyono (Deputy of Protection, BNP2TKI), Agusdin Subiantoro improvement of survey questionnaire were provided by Cynthia (Deputy of Placement, BNP2TKI), Maliki (Director of Population Clarita Kusharto (Financial Sector Specialist, GFM02), Yulia Her- Planning and Social Protection, National Development Planning awati (Survey Specialist, GSUID), Chitrawati Buchori (Consultant, Agency [Badan Perencanaan Pembangunan Nasional, or Bappe- GFM02), Sudarno Sumarto, Special Advisor of the National Team nas]), and Mahatmi Parwitasari Saronto (Director of Labour and for the Acceleration of Poverty Reduction (Tim Nasional Perce- Employment Opportunities Development, Bappenas). patan Penanggulangan Kemiskinan, or TNP2K), Lenny Rosalin, Deputy of Child Growth and Development, the Ministry of Child This report was produced under the overall guidance of Salman Development and Women's Empowerment, Ricky Adriansjah and Zaidi (Practice Manager, GPV02), Truman Packard (Lead Econo- Arini Rahyuwati from BNP2TKI, also by the Balance of Payments mist, GSP04), Vivi Alatas (Lead Economist, GPV02). It was prepared Statistics Team, Directorate of Economic and Monetary Statistics, by a core team led by Ririn Salwa Purnamasari (Senior Economist, the central bank (Bank Indonesia). Administrative data were pro- GPV02), and consisted of Edgar Janz (Senior Knowledge Manage- vided by Muhammad Hidayat, Ricky Adriansjah, and Indarji Her- ment Officer, GPV02), Peter Milne (Consultant, GSUID), Astrid mawan from BNP2TKI. Rengganis Savitri (Consultant, GPV02) and Taufik Indrakesuma (Economist, GPV02). Research and data analysis were invaluably Financial support for this report was generously provided by the executed by Hamidah Alatas (Consultant, GPV02), Kara Parahita Government of Australia’s Department of Foreign Affairs and Trade Monica (Research Analyst, GPV02) and Talitha Chairunissa. Con- (DFAT), through the Partnership for Knowledge-based Poverty Re- tributions to analytical works of this report also came from Mattia duction (PKPR) trust fund. During the preparation of this report, the Makovec (Economist, GSP03) and Matteo Sandi. Additional tech- trust fund was under the strategic oversight of Bambang Widianto, nical support was also provided by Bagus Arya Wirapati (Research Executive Secretary of TNP2K, and Rahma Iryanti, Senior Advisor Analyst, GPV02), Michaelino Mervisiano, Rizky Reza Fauzy and to the Minister of National Development Planning on Social Affair Tita Naovalitha (Consultant, GPV02). and Poverty Alleviation, previously the Deputy of Population and Employment of Bappenas. Page V Contents ES Executive summary P. 01 1 Introduction P. 11 2 Who Are Indonesia’s P. 19 Migrant Workers? Why Do They Migrate? 3 Protecting Female P. 29 Migrant Domestic Workers 4 Encouraging P. 37 Documentation Compliance 5 Sustaining the P. 45 Benefits of Labor Migration 6 Recommendations P. 53 Page VI Indonesia’s Global Workers List of Figures Figure 1.1 Share of current Indonesian migrants by destination country and legal status................................................................. 13 Figure 2.1 Share of migrant workers by highest educational attainment (%)..................................................................................22 Figure 2.2 Economic benefits of migration (current migrants)......................................................................................................23 Figure 2.3 The incidence of negative experiences is in decline.......................................................................................................26 Figure 3.1 Decreasing trend in total documented migrants, particularly women (thousand and %).................................................. 31 Figure 3.2 Economic benefits of migration (current female domestic worker)................................................................................32 Figure 3.3 Monetary costs of migration (current female domestic worker).....................................................................................32 Figure 4.1 Negative experiences of male migrant workers in Malaysia during migration...................................................................39 Figure 4.2 Duration of migration preparation (current male migrants in Malaysia)......................................................................... 40 Figure 4.3 Monthly net benefit by type of job (male migrants in Malaysia)..................................................................................... 41 Figure 4.4 Average monetary migration cost (male migrants in Malaysia).....................................................................................42 Figure 5.1 Economic benefits of migration by profile (current migrants)........................................................................................47 Figure 5.2 The main remittances channels used by migrant workers .............................................................................................52 Figure 5.3 Distribution of migrant households by top three highest remittance uses (current migrants) ............................................53 Figure 5.4 Returning migrants engaged in paid work for former migrants......................................................................................54 Figure A.I.1 The 15 selected provinces in the WB-IIMR Survey .......................................................................................................... 72 Figure A.I.2 Quantitative survey of Indonesia’s International Migration and Remittances ...................................................................73 Figure A.I.3 Compositions of migrant workers by province of origin ................................................................................................75 Figure A.I.4 Proportion of migrant worker households by province ..................................................................................................76 Figure A.I.5 Gender composition of migrant workers by province ....................................................................................................77 Figure A.I.6 Composition of current and former migrants by province .............................................................................................77 Figure A.I.7 Composition of migrant worker’s area of origin by province...........................................................................................77 Page VII List of Boxes Box 1.1 The World Bank Survey on Indonesia International Migration and Remittances................................................................. 17 Box 3.1 Roadmap towards zero domestic workers by 2017........................................................................................................33 Box 3.2 Bilateral agreement on domestic workers between the Philippines and Saudi Arabia.........................................................35 Box 4.1 The Philippines’ efforts to streamline migrant documentation.......................................................................................44 Box 6.1 Short-term Priority Actions.......................................................................................................................................56 List of Tables Table 2.1 Incidence of negative and traumatic experiences encountered by current migrant worker (%)...........................................26 Table 2.2 Current migrant workers’ characteristics, by profile (%)...............................................................................................27 Table 3.1 Current migrant workers’ activity prior migrating (%).................................................................................................. 31 Table 3.2 Incidence of negative and traumatic experiences by current female domestic workers (%)................................................33 Table A.I.1 Questionnaire structure........................................................................................................................................... 74 Page VIII Indonesia’s Global Workers Abbreviations & Acronyms BNP2TKI Badan Nasional Penempatan dan Perlindungan Tenaga Kerja Indonesia (National Agency for the Placement and Pro- tection of Indonesian Migrant Workers) BPJS Badan Penyelenggara Jaminan Sosial (Social Security Provider Agency) BPS Badan Pusat Statistik (Central Bureau of Statistics/Statistics Indonesia) CoC Code of Conduct Desmigratif Desa Migran Produktif (Productive Migrant Village) DFAT Department of Foreign Affairs and Trade (Australia) Diyanet Department of Religious Affairs (Turkey) DJSN Dewan Jaminan Sosial Nasional (National Social Security Council) DOLE Department of Labor and Employment (Philippines) EPS Employment Permit System FDI Foreign Direct Investment G2G Government-to-Government GDP Gross Domestic Product IDR Indonesian Rupiah ILO International Labor Organization IME Institute of Mexicans Abroad IOM International Organization for Migration J-PAL Abdul Latif Jameel Poverty Action Lab KNOMAD Global Knowledge Partnership on Migration and Development KTKLN Kartu Tenaga Kerja Luar Negeri (Overseas Worker’s Card) KUR Kredit Usaha Rakyat (People’s Business Credit) Page IX LTSA Layanan Terpadu Satu Atap (Integrated One Gate System) M&E Monitoring and Evaluation MoA Memorandum of Agreement MoU Memorandum of Understanding NGO Non-Governmental Organization OFW Overseas Filipino workers OJK Otoritas Jasa Keuangan (Financial Service Authority) OWWA Overseas Workers Welfare Administration (Philippines) PAP Pembekalan Akhir Pemberangkatan (Pre-Departure Briefing) PNPM Program Nasional Pemberdayaan Masyarakat (National Program for Community Empowerment) POEA Philippines Overseas Employment Administration POLO Philippines Overseas Labor Offices PPTKIS Pelaksana Penempatan Tenaga Kerja Indonesia Swasta (Private Placement Company for Indonesian Migrant Workers) Sakernas Survei Angkatan Kerja Nasional (National Labor Force Survey) SJSN Sistem Jaminan Sosial Nasional (National Social Security System) SLBFE Sri Lanka Bureau of Foreign Employment Susenas Survei Sosial Ekonomi Nasional (National Socio-Economic Survey) TNP2K Tim Nasional Percepatan Penanggulangan Kemiskinan (National Team for the Acceleration of Poverty Reduction) UN United Nations WB-IIMR World Bank Indonesia’s International Migration and Remittances Survey Page X Indonesia’s Global Workers Main job types of Indonesian migrant workers Maid / Baby Sitter Farm Worker Construction Worker Factory Worker 32% 19% 18% 8% Page XI Caregiver for elderly Store / Hospitality staff Driver Cruise Ship Crew 6% 4% 2% 0.5% Executive P. 0 1 Summary P. 0 5 Developing a Longer-term Migrant Worker Reform Strategy P. 07 Kick-starting Reform with Short-term Priority Actions P. 0 8 Embedding Migrant Worker Reform into a Broader Indonesian Jobs Creation Strategy P. 0 9 Conclusion 1 Using IMF average exchange rates in Indonesian overseas labor migration makes a 2016 (US$1 = IDR 13,330). major contribution to the lives of many ordinary 2 During 2013-14, the World Bank, in collaboration with BPS-Statistics workers, their families, and the economy as Indonesia, conducted the first ever nationwide household survey a whole. More than 9 million Indonesians are on international migration and remittances, across 104 districts in 15 now working overseas, equivalent to almost 7 provinces identified as the main sending percent of Indonesia’s total labor force. Only provinces of Indonesian migrant workers. These rich and comprehensive China and the Philippines have more migrants data of 4,660 Indonesian migrant workers and their families—estimated working overseas than Indonesia in the East Asia to represent about 70 percent of total migrant workers—have made rigorous region. International migration makes a major research on the topic possible, helping to inform and guide policy discussions contribution to the economy; in 2016, migrant concerning labor migration issues. As workers sent over IDR 118 trillion (US$8.9 billion) a result, we now have a much better understanding of the characteristics of back to Indonesia in remittances.1 Also, recent Indonesians who seek work overseas, where they come from, where and why research2 shows just how much labor migration they go, the problems they encounter, and the economic benefits they enjoy. contributes directly to improving people’s lives. Page 3 Indonesia’s Global Workers The benefits of migration 1 Gainful employment Many of those without work in Indonesia have found gainful employment overseas, often for Migrant workers the first time in their lives. About 56 percent of migrant workers were primarily engaged in earn up to 6× housekeeping or unpaid work before migrating, leaving just 44 percent with experience of a paid job before working abroad. more when work- 2 Higher earnings ing overseas Indonesian workers who already had jobs in-country before migrating typically earn up to four to six times more when working overseas. Recent survey data show that migrant workers are able to earn an average monthly wage of IDR 3.7 million (US$281),3 about four times their average wage prior to migrating. Meanwhile, female migrant workers going to the more de- veloped Asian countries (Chinese Taipei, Hong Kong SAR, Singapore, etc.) are able to earn up to six times as much as they earned in their previous jobs in Indonesia. 3 Acquiring skills & experience Low-skilled workers acquire new skills and experience while working abroad and, as a result, Remittance reduce often find better jobs on their return home. The majority of former migrant workers (77 per- the probability of cent) state that they obtained new skills during migration. Moreover, among those who had Indonesian house- unpaid jobs before migrating, more than half find paid employment on their return to Indo- holds being poor by nesia. 28% 4 Relieving financial strain on households Remittances from Indonesian migrant workers make an important contribution to poverty reduction. Research shows that remittances reduce the probability of Indonesian households being poor by 28 percent (Adams and Cuecuecha, 2011). Families at home benefit financially by covering the costs of basic needs, including food, housing, education and health. Over 80 percent of surveyed migrant worker households report “daily needs” as being one of their top three uses for remittance income. This relieves the strain on poor families. In the case of female migration, it helps to reduce child labor participation by between 17 to 32 percentage points, without discouraging labor-force participation among remaining household members (Nguyen and Purnamasari, 2014). 5 Lasting benefits Finally, remittances also contribute to improving longer-term livelihoods for migrant workers and their families. About 40 percent of migrant households channel their income from remit- tances into education, 15 percent invest that income into business capital, and more than 20 percent report putting the money into savings accounts. 3 Monthly wage after deducted by (monetary) migration costs. Page 4 Executive Summary B ut at times, working abroad can be a risky proposition. Stories of abuse of Indone- sian migrant workers abroad have creat- ed a body of opinion that feels too little is being done to protect them. Reported cases, in particular among female domes- tic workers, highlight the risks involved, such as physical and sexual abuse, forced labor and unpaid wages. The government responded to these concerns by placing a moratorium on migration to Malaysia for two years from 2009 and banning female domestic migrant workers from going to Saudi Arabia in 2011. In 2015, moratoria were extended to 21 countries across the Middle East, North and East Africa, and Pakistan. However, moratoria can also have unintended negative consequences. Not only in Indonesia’s experience of its morato- rium on sending migrant workers to Malaysia in 2011, but also in the Philippines’ experience of a moratorium on sending workers to Saudi Arabia, there was a rise in undocumented migration to those countries that exposed migrant workers to greater risks. Over time, however, the profile of Indonesian migrant workers has changed, and Indonesian migrant workers can no longer be rep- resented by a single profile. Previous migration policies have been largely driven by efforts to protect one specific group of migrant workers—female domestic workers, especially in Middle-Eastern countries—who are the most likely to be mistreated. Today, however, this group only comprises 13 percent of total Indonesian migrant workers. There are now two other major categories of migrant work- ers that outnumber migrant workers to the Middle East. The first category is men working in Malaysia without the documentation required by the government (26 percent of current migrant work- ers). The other major category of current migrant workers is those working in the more developed countries of East Asia, in particular in Chinese Taipei, Hong Kong SAR and Singapore (27 percent). These three profiles com- Professionalize prise two-thirds of all Indonesian migrant workers, but face distinctly different and modernize problems and challenges, each of which requires policy responses that protect workers without endangering their livelihoods and the positive impact of in- labor migration ternational migration. so that migrant Indonesia’s migration labor policies and programs need to benefit all types workers, regardless of migrant workers, by maximizing the benefits of migration in general while of type of job and minimizing the risks. This is best done by professionalizing and modernizing destination, gain the sector so that migrant workers, regardless of type of job and destination, gain higher earnings and receive better protection. This requires a coherent higher earnings and medium/long-term strategy that pulls together all relevant government and receive better agencies and civil society organizations that also play an important role in de- veloping skills, providing protection services and support to migrant workers protection and their families. Indonesia already has the political will, the knowledge, and the resources to develop and implemented a coherent strategy. Overall, three core objectives should underpin the guiding principles of the strategy: (i) pro- viding more access to higher-income jobs for Indonesian workers, in particular low-skilled and female workers who lack good domestic employment opportu- nities; (ii) promoting and protecting the rights of migrant workers throughout the migration cycle; and (iii) improving reintegration of returning migrants into the Indonesian economy. Page 5 Indonesia’s Global Workers 1 Creating a professional jobs marketplace for international migrant workers International labor migration is an import- Developing a Longer– ant sector of the Indonesian economy in its own right, requiring commensurate efforts term Migrant Worker to improve its professionalism as a sector and instill modernization across its various components to maximize its potential for Reform Strategy the benefit of all stakeholders. The following three reform initiatives could help to spur this process of professionalization and modern- ization: (i) better linking Indonesia’s migrant workers to international work opportunities by ensuring skills development is in response to overseas demand and standards; (ii) intro- ducing modern information systems to im- prove transparency in the job market, includ- ing publishing overseas vacancies in public Five reform priorities will domains and sharing more widely the ben- support the professionalizing efits of migrating through the documented and modernizing of Indonesia’s channel; and (iii) improving the quality and migrant labor sector. The accountability of recruitment agencies. government recognizes the importance of international 2 labor migration and the resulting remittances for many Indonesians, including migrant families, especially those with low skill levels who have few opportunities for work in Indonesia. To harness development impacts of Streamlining the documentation migration, a comprehensive strategic reform will be required & pre-departure process to incorporate international labor migration into the national The current process of becoming a docu- development agenda, and mented migrant worker is burdensome, with build labor migration into a 22 separate administrative steps, and can professional and modern sector take up to three months, creating a disincen- on a par with other sectors of the tive for prospective migrants to choose the economy. Although policymaking documented path. Accelerating and stream- in this area is politically lining the documentation process would help sensitive and complex, new to reduce migration costs and subsequently empirical findings that draw on encourage workers to migrate through safer the recent data on Indonesian formal channels. Several reforms can be un- labor migration provide the dertaken to tackle this issue: simplifying the government with important documents required, removing some unnec- inputs to formulate evidence- essary and overly bureaucratic stages, and based medium- and long-term integrating the process such as through a policy reforms and program one-stop shop initiative. innovations. Page 6 Executive Summary 3 Raising the bar on the 4 Sustaining the benefits of 5 Revisiting institutional protection for workers who the migration experience & arrangements & introducing are abroad remittances better monitoring & evaluation At times, some migrant workers could risk The benefits that accrue from international Indonesia would benefit from establishing a facing bad or even traumatic experiences labor migration cover a multitude of aspects, coordinating mechanism to inform the for- when working abroad. Promoting viable pro- from the various skills acquired by working mulation of labor-migration policies. Under tection will require three steps to proactively overseas, the broad life-enriching experience the oversight of one ministry, such a mech- minimize the risks associated with migration: gained by migrants while living abroad be- anism could facilitate coordination across all yond the routine of working and earning in- the relevant ministries and agencies, as well First, shifting from memoranda of under- come, and the resulting remittances sent to as the private sector and civil society organi- standing (MoU) to more legally binding bilat- family members to support their welfare and, zations to balance various concerns and in- eral agreements would help to promote and if possible, for longer-term investments in terests. Meanwhile, developing a monitoring protect migrant workers’ rights. Indonesia education, health and small business start- and evaluation (M&E) system would help to can learn from the examples of the Philip- ups. Despite the opportunity to earn higher in- support a shift to more evidence-based poli- pines and other labor-sending countries that come and gain new skills and experience while cymaking among the relevant institutions. A have successfully negotiated effective bilat- abroad, many migrants from this group, most- coherent M&E system would enable the gov- eral agreements that cover placement, wage ly female domestic workers, fall out of the ac- ernment to adjust the course of policy and and labor contract details, migration costs, tive labor force after returning home. The gov- program implementation in a timely manner, and protection measures. ernment can play an important role in creating formulate policy reform based on evidence, a conducive environment that harnesses the and help to improve transparency. Second, Indonesia should consider ramping development impact of migration and ensures up the use of labor attachés at Indonesian that the impact of remittances is sustainable. embassies and consulates in major destina- tion countries. Given the huge number of In- donesians now working overseas, the current 13 labor representatives covering the 12 main destination countries need to be reinforced. The government might also consider tapping into diaspora communities who could en- gage with migrant workers and provide help on relevant issues. Third, bringing migrant workers’ insurance under the mandatory National Social Se- curity System (SJSN)4 should provide cover- age during all stages of migration. This will require specific arrangements between the two branches of SJSN administrators and the insurance providers in destination countries, as well as redesigning migrant workers’ insur- 4 The SJSN covers all ance to separate uninsurable risks from the Indonesians for health main insurance policy. A top-up plan to cover issues (under Jaminan Kesehatan Nasional uninsurable risks outside the SJSN, covering [JKN], or the health early terminated, physical abuse and sexual program) and four harassment, should be administered by private other types of protection, namely work accidents, or other government institutions outside the old-age savings, pen- Social Security Administration Agency (Badan sions, and death benefits (under Jaminan Sosial Penyelenggara Jaminan Sosial, or BPJS). Bidang Ketenagakerjaan, or the employment programs). Page 7 Indonesia’s Global Workers Kick- starting Reform with Short-term Priority Actions The reforms identified above will take time to prepare and implement. However, several quick wins could be initiated immediately and implemented by the government over the next couple of years. These short-term priorities are likely to have a significant impact on professionalizing international labor migration, are feasible and action-oriented, and are most likely to improve the welfare of low-skilled migrants and their families. Page 8 Executive Summary 1 Develop a comprehensive 2 Continue efforts to accelerate 3 Institute an M&E framework 5 Desmigratif (Desa Migran Produktif, or Pro- information dissemination and streamline the migrant starting with new migration ductive Migrant Village) strategy to share the benefits of worker documentation programs. While a coherent is a new government program to ensure safe migration more widely, reduce process. To reduce long waiting M&E system could be developed migration and improve undocumented migration times of up to 2-3 months, incrementally, the government economic opportunities through better knowledge the current 22 documentation could start first by designing of former migrants and their families. The pro- on the benefits of migrating steps need to be significantly an M&E framework as an gram, which focuses on through the formal channel, reduced so that they can be integral part of one of its new intervening at the village level, consist of four provide better job-matching completed within a period of labor-migration programs, pillars, namely migration outcomes, protect migrants one month. Moreover, to lower for example the Desmigratif services, productive eco- through greater awareness documentation costs and make program.5 Having an nomic activities, com- munity parenting and of their rights and redress them more transparent, some embedded M&E framework village cooperatives. This mechanisms, and ensure components of the expenses within Desmigratif would program is under the leadership of Ministry greater accountability of that are regulated and standard enable the government to of Manpower but relies private sector and government (e.g., obtaining a passport, an understand the ways in which on collaboration across government agencies actors by removing asymmetric accredited skills certificate, the program drives change including the Ministry of information leading to an and a medical check-up), and help to improve its future Villages, Development of efficient platform for job- could be paid directly to the implementation. Furthermore, Disadvantaged Regions and Transmigration, the matching. service provider instead of being experience gleaned from Ministry of Cooperatives included in the placement cost applying the M&E system to and Small-Medium En- terprises, the Ministry of structure. This effort could be Desmigratif could then be Telecommunication and enhanced by expanding the applied by the government Information, the Ministry of Child Development establishment of the Integrated elsewhere to better integrate and Women's Empow- One-Gate System (Layanan such M&E frameworks into other erment, the Ministry of Terpadu Satu Atap, or LTSA) policies and programs. Health, the Ministry of Youth and Sport, and to all major migrant worker- Bank Negara Indonesia sending provinces to make the (a state-owned bank). The Ministry of Manpow- documentation process simpler, er plans to implement faster and cheaper. Desmigratif in 120 villag- es across 60 districts as part of its 2017 program, 130 villages in 2018, and 150 villages in 2019. Page 9 Indonesia’s Global Workers International migration provides opportunity for higher-earning jobs, especially for low-skilled workers Embedding Migrant Worker Reform into a Broader Indonesian Jobs Creation Strategy M igration worker reform is not a stand-alone strategy but needs to be embedded within the broader poverty and inequality reduc- tion agenda, in which a national jobs creation strategy is central. While the government is striving to implement policies to maxi- mize the benefits of safe migration, it needs to go one step further to ensure that these policies are mainstreamed into national development plans and become part of a national jobs strategy. Creating more inclusive and better-paid jobs in Indonesia would provide prospective migrant workers with attractive and competitive opportunities at home, and a viable alternative to working abroad. In such a scenario, prospective migrant workers might consider international labor migration as just one of several competitive options, instead of the only realistic option for finding a well-paid job to improve the welfare of their families. Designing and implementing a national jobs strategy, however, is a complex and politically challenging task. Creating more inclusive and higher-earning employment opportunities in Indonesia will call for not only a structural trans- formation, but also a range of multifaceted reforms that include: addressing constraints and barriers to productivity growth, particularly through better in- frastructure and greater competitiveness; revamping the skills training system to better meet industry demands; and negotiating and implementing a “grand bargain” between various government ministries and agencies, employers and labor unions to overhaul existing labor-market regulations and provide more effective worker protection. These reforms, however, are complex and will take significant time to design, negotiate and implement, especially because they need to be aligned and coherent across many ministries. Therefore, while generating more and better quality jobs is a longer-term goal, international labor migration will continue to play a valuable role in the short- to medium-term. International labor migration creates an important opportunity for providing higher-earning jobs in the short to medium term, especially for low-skilled workers with few if any other options. As this report shows, the issue of Indonesian labor migration is broad-ranging, complex and often emotive. However, provided with this newly developed empirical evidence, and learning carefully from international experience and best practice, Indone- sia is now better placed than ever before to take effective action on this issue. Page 10 Executive Summary Conclusions International labor migration by Indonesians has a highly beneficial impact on workers who spend time abroad, their families back in Indonesia, and the Indonesian economy as a whole B ased on the recent research conducted by the World Bank in col- laboration with BPS-Statistics Indonesia (Badan Pusat Statistik, or BPS) presented in this report, there can be little doubt that, despite some risks, international labor migration by Indonesians has a highly beneficial impact on workers who spend time abroad, their families back in Indonesia, and the Indonesian economy as a whole. Equipped with this new in-depth nationwide evidence-based understanding of international labor mi- gration, the government is now in a position to design policies and programs to maximize the benefits of labor migration, and professionalize and modernize this sector of the economy, while also ensuring that the risks of migrations are mitigated as much as possible. While the long-term goal is ultimately to en- sure that Indonesia creates good-quality well-paid jobs at home, in view of the length of time needed to achieve this goal, in the interim the government can play a crucial role in ensuring that international labor migration contributes as much as is feasible towards improving people’s lives, and reducing poverty and inequality. P.1 1 Introduction In 2016, over 9 million Indonesians, both docu- mented and undocumented, were working abroad as migrant workers, a number that is equivalent to almost 7 percent of Indonesia’s total labor force.6 Over the past 10 years, Indonesian migrant workers have become an increasingly numerous and import- ant component of the national labor force. In 2005, about 3 million documented Indonesians worked overseas, comprising about 3 percent of the country’s total labor force. By 2016, over the course of a decade, the number of documented migrant workers rose to almost 4.9 million and constituted about 3.8 per- 6 To migrate through official channels and cent of the national labor force at that time—but the become a “document- number is far higher if undocumented migrants are ed migrant”, one must comply with official pro- included. In the East Asia region, only China and the cedures of recruitment and placement required Philippines have more migrants working overseas by the National Agency for the Placement and than Indonesia. Most of these Indonesian workers Protection of Indonesian Migrant Workers move to nearby Malaysia to find work, while the rest (BNP2TKI), and thus find work in other East Asian countries and the Mid- have official docu- ments required to work dle East (Figure 1.1). overseas. Ch.1 Page 13 Indonesia’s Global Workers Figure 1.1 Share of current Indonesian migrants by destination country and legal status SAUDI AR ABIA 13% Male Male Documented Undocumented 21% 29% 30% 19% Female Documented Female Undocumented Page 14 Introduction H O N G KO N G S A R 6% C H I N E S E TA I P E I 10% M A L AY S I A SINGAPORE 55% 5% M any of these workers migrate Indonesian migrant workers make a major 7 All figures, unless notes otherwise, are based on the World Bank Survey without the documentation contribution to the economy, sending over on Indonesia International Migration legally required by the Gov- IDR 118 trillion (US$8.9 billion) back to In- and Remittances 2013/14, subsequently ernment of Indonesia. Nearly donesia in remittances in 2016. Remittanc- referred to as the WB-IMR Survey. 8 Two approaches are used to identify half of Indonesian migrant workers travel es are now at historically high levels, equiv- the legal status of a migrant worker in overseas without going through official le- alent to 1 percent of Indonesia’s total GDP. the WB-IMR Survey: (i) Strict definition approach, if a migrant worker submit- gal channels (i.e., undocumented workers) Documented migrant workers contributed ted all the documents required to work (Figure 1.1). More than half of these undoc- 56 percent of all remittances, while undoc- overseas, and (ii) Less-strict definition umented migrant workers are men going to umented workers remitted the rest. Remit- approach, if a migrant worker has either submitted all the document re- Malaysia. Although it is difficult to estimate tances make an important contribution to quired to work overseas, or has obtained the size of this group accurately, recent sur- the economy; they exceed total government the job through a formal channel, or vey7 findings suggest that at least 4.3 million spending on social assistance programs—at has attended the pre-departure brief- ing. The second definition is used in the migrants are working abroad without proper IDR 89 trillion (US$6.7 billion) in 2016—and analysis in this report. documentation.8 were equal to about 30 percent of Indonesia’s total foreign direct investment (FDI) in 2016. Page 15 Indonesia’s Global Workers In 2016, over 9 million Indonesians were working abroad as migrant The government recognizes the importance of migration and the workers remittances it brings into the economy. The growing size and im- portance of the remittances being sent back to Indonesia by migrant workers has not gone unnoticed by the government. As a result, the government has introduced policies in recent years to try to max- imize the benefits of international labor migration. These include signing Memoranda of Understanding with some of the destination countries, the establishment of a smoother migration process, and efforts to ensure that migrant workers receive adequate protection, with labor attachés now being placed in Indonesian consulates in the most important destination countries. But some observers complain that the Indonesian government has not done enough to protect migrant workers overseas. In re- cent years, stories of serious abuse of Indonesian migrant workers abroad began to surface in the media, giving rise to a growing body of opinion that felt that too little was being done to protect the country’s overseas workers. At first, these stories emanated mainly from Malaysia but, in 2011, the execution of an Indonesian domestic worker in Saudi Arabia not only served to increase public outrage but also led observers to realize the problems were more widespread. In response to the increase in reported cases of abuse—including unpaid wages, physical and sexual abuse, and forced labor—the government responded in 2009 by placing a moratorium on female domestic workers going to Malaysia. The moratorium was lifted in 2011 after both countries came to an agreement on how to improve migrant workers’ conditions and implement protective measures. However, the further serious cases of abuse in Saudi Arabia prompt- ed the government to adopt more drastic restrictions on migration elsewhere. The government responded to the subsequent outcry from the public and civil society organization over the execution in 2011 by issuing a moratorium on female domestic migrant workers going to Saudi Arabia in the same year. In May 2015, this moratori- um on the placement of Indonesian female domestic workers was extended to 21 countries across the Middle East, North and East Africa, and Pakistan. Indonesia’s migrant worker policies, both existing and proposed, have sparked a major national debate on the issue of labor migra- tion. The government has been developing a raft of policies ranging from improving the protection of documented migrant workers, to initiatives aimed at improving compliance with documentary requirements and making undocumented migration harder. While some of these ideas have received broad support, others have gen- erated fierce debate about their efficacy. For instance, while some applaud the administration for taking steps to protect Indonesian workers abroad through moratoria, others see the proposed policies as unwise, especially in the absence of any significant acceleration in domestic job creation to compensate for the additional unem- ployment that would be caused by restrictions in migrant worker flows. Others have suggested that moratoria are not the best way to improve protection to migrant workers. Instead of prohibiting people from becoming migrant domestic workers, some argue that the government should instead look for solutions to address the root cause of the safety problems more directly. Page 16 Introduction 118 Indonesian migrant workers make a major contribution to the economy, sending over Rp Trillion back to Indonesia in remittances in 2016 Informed and constructive debate on the issue of migrant work- er policies has been hampered by a lack of data and empirical research on Indonesian migrant workers. Our understanding of the risks faced by Indonesian migrant workers, particularly female domestic workers, has long been incomplete, and it is therefore not surprising that the appropriateness of some policy responses remains controversial. One of the major problems facing Indonesian policymakers is that there has been a dearth of empirical data on the true nature of the risks faced by migrant workers, as well as the benefits they accrue. Much of the evidence on risks largely depends on anecdotal cases that are usually self-reported by Indonesian migrant workers themselves, either to the National Agency for the Placement and Protection of Indonesian Migrant Workers (Badan Nasional Penempatan dan Perlindungan Tenaga Kerja Indonesia, or BNP2TKI) or non-government organizations (NGOs) that provide support for migrant workers in difficulty. Meanwhile, the available information on the economic benefits is mainly from a macroeco- nomic perspective, not on the impact on families. But now, for the first time, Indonesia has valuable survey data on migrant workers and their households. Recognizing the lack of evidence on labor migration in general, the World Bank collabo- rated with BPS-Statistics Indonesia (Badan Pusat Statistik, or BPS) to design and implement a nationwide household survey on inter- national migration and remittances. This first ever comprehensive nationwide survey was conducted in late 2013 and early 2014 across 104 districts in 15 provinces identified as the main sending provinces of Indonesian migrant workers (Box 1.1). Page 17 Indonesia’s Global Workers Box 1.1 Now, for the first time, The World Bank Survey on Indonesia International Migration & Remittances In order to fill the gaps in comprehensive data on international migration and remittances in Indonesia, the World Bank, in close collaboration with Indonesia has valuable BPS and funded by the Australian Government (through the Department of Foreign Affairs and Trade) (DFAT), conducted the first ever nationwide sur- vey in Indonesia on international migration and remittances in 2013-14. The design and implementation of the World Bank Survey on Indonesia Interna- tional Migration and Remittances 2013/14 (subsequently referred to as the survey data on migrant WB-IIMR Survey) was integrated with the National Socio-Economic Survey (Susenas), a nationwide household-level survey regularly conducted by BPS to collect information on consumption, housing conditions, demographics, workers employment, education and other socioeconomic indicators. and their In order to capture conditions and activities experienced by Indonesian mi- grant workers throughout the various stages of migration, the questionnaire is divided into sections and arranged according to the stages of being an households international migrant worker. The sequences of the questionnaire start with questions on access to information before migration, recruitment and the placement process, followed by questions on types of work, wages, work- ing conditions abroad, and concludes with channels for sending remittances and their ultimate usage. For returned migrant workers, there are additional questions on labor market participation after they returned to Indonesia. A series of consultations with relevant stakeholders and resource persons (i.e., BNP2TKI, BPS, the National Team for the Acceleration of Poverty Reduc- tion [Tim Nasional Percepatan Penanggulangan Kemiskinan, or TNP2K], the central bank [Bank Indonesia], the Ministry of Women’s Empowerment, the World Bank Finance and Markets team, The Global Knowledge Partnership on Migration and Development [KNOMAD], and the National Program for Community Empowerment [Program Nasional Pemberdayaan Masyarakat, or PNPM] Support Facility), as well as a number of pilots and workshops, were conducted during the development of the questionnaires to ensure the inclusion of all the key issues and concerns on international labor migration. Following the Susenas schedule, data collection for the WB-IIMR Survey was conducted in December 2013 (4Q13) and in March 2014 (1Q14) in 104 dis- tricts across 15 provinces considered to be the main sending provinces of Indonesian migrant workers. The two rounds of data collection in the se- lected districts visited around 35,350 households (about one quarter of the total Susenas sample of households). About 11 percent of these visits were to households (i.e., around 3,940 households) reported as having members who formerly worked or were currently working overseas, either through legal or illegal routes. Within these 3,940 surveyed households, there were about 4,660 individuals defined as migrant workers, with 2,200 individuals categorized as former/returned migrant workers and 2,460 individuals who were still actively working overseas (current migrant workers) at the time of the survey. This survey data is estimated to represent about 70 percent of to- tal migrant workers, from more than 85 percent of total migrant households, at the national level. Integrating this migration and remittances survey into Susenas allows for a comprehensive analysis and comparison of the features and behaviors of documented and undocumented migrant workers, migrant versus non-mi- grant households and areas, including their demographic characteristics, socioeconomic performance, and cases of positive and negative deviance. For full details of the Survey, please refer to Annex I: Survey on Indonesia’s International Migration and Remittances. Page 18 Introduction Research using these new data provides ev- remittances. It also helps to inform and fuel section begins with underlining the diver- idence that can help to inform the current a constructive policy dialogue with a view to sity of risks and opportunities faced by In- debate on policies regarding international designing policies that provide real protection donesia female domestic workers given their migrant workers. The rich and comprehen- for migrant workers without, at the same time, different characteristics, including country sive data now available make it possible to undermining their economic potential. destinations. Section 4 delves into the is- generate research to support the govern- sue of undocumented migration, including ment’s policy planning in this area. There- This report aims to point towards the best the government’s efforts to encourage doc- fore, following on from the WB-IIMR Survey, policy mix for Indonesia’s various inter- umented migration. This section focuses on the World Bank, in consultation with the Gov- national migrant worker groups who face undocumented male workers in Malaysia, ernment of Indonesia and with the support widely differing risks and gain diverse eco- who account for about one-third of all In- of the Australian Government, launched a nomic benefits from migration. Following donesian migrant workers. Section 5 then research project to better understand the dis- this introduction, Section 2 of the report looks as how best to sustain the benefits tinct characteristics of Indonesian migrant looks at the major profiles of Indonesian of migration, with particular reference to workers, the extent to which international la- migrant workers and their reasons for mi- a third profile of migrant workers, namely bor migration provides economic benefits to grating. This includes the ways in which the those who work in the more developed coun- migrant workers and their families, and the unique features of the various profiles pose tries of East Asia and who generally earn country’s economy as a whole, what are the different levels of vulnerability to risks and the highest wages. It looks at issues such as risks facing migrant workers; and become economic opportunities from migration. improving remittance usage and facilitat- cognizant of how the current institutions While Section 2 covers all Indonesian in- ing economic activities after returning from and policies regulating migration play a role ternational migration, the following sec- migration. Finally, Section 6 rounds off the in providing protection during the three stag- tions focus on specific profiles of migrant report with broad policy recommendations es of the migration cycle. This research fills workers and some of the challenges that a gap in the empirical evidence on the costs they face. Section 3 focuses on the discus- and benefits of international migration and sion about female domestic workers. The P.1 9 Ch.2 Who Are Indonesia’s Migrant Workers? Why Do They Migrate? P. 2 1 Features of Indonesian Migrant Workers P. 2 3 Reasons for Migrating P. 2 5 Risks of Migration P. 2 7 Main Profiles of Migrant Workers Page 21 Indonesia’s Global Workers Features of Indonesian Migrant Workers I ndonesian migrants mostly come from rural areas and are concentrated in a few regions. Despite recent strong growth in Indonesia’s urbanization, over 72 percent of Indonesian current migrants still come from rural areas. Possibly due to the lack of job opportunities in rural areas, there is a significantly higher chance that people from rural areas will become migrant work- ers than those from urban areas.9 Over 86 percent of these current migrant workers come from either the islands of Java or Nusa Tenggara. Although in terms of total numbers the majority of migrant workers come from East Java, it is migrant workers from West Nusa Tenggara who play the most important role in their local labor force. For instance, the estimate shows that current documented and undocumented migrant workers in West Nusa Tenggara contribute almost 35 percent to local labor force absorption. In other main sending areas, the average share of migrant workers in the local labor market is less than 6 percent. 9 A comparison of the probability of becoming a migrant worker between people from rural areas versus urban areas is obtained from the probit regression results. A probit regres- sion of the probability of becoming a migrant is run by controlling for migrant’s individual characteristics (gender, age, relation to the head of household, education, marital status, and employment), migrant’s household characteristics (household size, gender composition, characteristics of the head of household, dependency ratio, school participation of children, labor intensity, per capita expenditure, income suffi- ciency for daily needs, house ownership, and predominant material of wall), access to information and networks to migration, and geographic fixed effects. Page 22 Who Are Indonesia’s Migrant Workers? Why Do They Migrate? Almost two- thirds of migrant workers come from poorer areas Almost two-thirds of migrant workers’ sending districts are in where average relatively poorer regions where average poverty rates are higher than the national average. Households with migrant workers have poverty rates per-capita expenditures 15 percent lower, on average, than those are higher than without migrant workers (Susenas, 2014). Constrained by the chal- lenging economic conditions in these sending regions, migrant the national workers from these households seek jobs abroad to support their average families financially back home. Migrant workers are mostly poorly educated, although they are gradually becoming better educated than before. More than three-quarters (78 percent) of current migrant workers graduated from middle-school or below, with half of these having only complet- ed elementary school. Migrant workers from urban areas are gener- ally better educated than those from rural areas, with the presence of high school graduates 6 percentage points higher among migrant workers from urban than rural areas. When compared with former migrants, there is a distinct improvement in the education level of Indonesian migrant workers, with migrant workers who have mid- dle school or high school education around 12 percentage points 78 higher among current migrants (51 percent) than among former migrants (39 percent). %of current migrant workers are low-skilled, who never reached high school Figure 2.1 Elementary school or below Share of migrant workers by highest Middle School educational attainment (%) High School Current Migrants 48 30 20 Former Migrants 60 22 18 Source: World Bank Indonesia’s International Migration and Remittances Survey 2013/14. Page 23 Indonesia’s Global Workers Reasons for Figure 2.2 Migrating Economic benefits of migration (current migrants)(IDR thousands) Income before migration Income during migration Monthly net benefit Net income ratio(Ratio) W orking abroad provides oppor- Working 3,748 tunities for many Indonesians to enter the active workforce and abroad seek a higher salary. Migration provides 2,607 is an entry point for employment opportunities 3.7 for many. While most current mi- grant workers fall into the productive ages between 21 for many 1,000 and 40 years old, only 44 percent of migrant workers Indonesians were engaged in paid employment before migrating; the others were primarily occupied with housekeeping or to enter unpaid work. Even when they did have jobs, these jobs the active Total were not well paid. For example, current migrant work- workforce ers captured in the survey who had previously worked in the agriculture sector earned an average monthly in- and seek a come of IDR 765,000 (US$57), lower than the average in- higher salary come of full-time agricultural workers of IDR 1,076,000 4,056 (US$81) per month (Sakernas, 2013). This suggests either underpayment or underemployment in the previous jobs 2,701 of those who chose to migrate. 3.6 Indonesian labor migration is driven by a lack of good 1,118 domestic job opportunities coupled with higher po- tential earnings from overseas labor markets. Existing studies show that labor migration is predominantly driv- en by income differentials between labor-sending and labor-receiving countries. In many cases, unemploy- Male ment and elevated levels of poverty in the sending coun- tries serve to amplify people’s motivation to look for bet- ter opportunities to raise their living standards (World Bank, 2014b; International Organization for Migration, 3,359 2013). In line with these findings, survey data confirm that the most important push factors for Indonesian 5.3 overseas labor migration include the lack of good job opportunities with high earnings in the domestic labor 2,229 market. Major pull factors include the substantial wage difference between overseas and domestic jobs, which 634 appears to be the most important economic factor driv- ing international migration. Earnings from jobs over- seas can be up to four or six times earnings in migrants’ previous jobs in Indonesia. Nearly 50 percent of current Female Indonesian migrant workers say that their main reason for working abroad was for higher expected earnings. Meanwhile, demand for overseas jobs also appears to be Source: World Bank Indonesia’s International Migration and driven by success stories of returning migrant workers, Remittances Survey 2013/14 who display improvements in their economic condition. 70 Page 24 Who Are Indonesia’s Migrant Workers? Why Do They Migrate? % of former migrant workers reported having a better economic standing after migration Most migrant workers are able to earn considerably more, even after taking the additional costs of migra- tion into account. A majority (70 percent) of former migrant workers reported achieving economic improve- ments after migration. Survey data indicate that migrant workers are able to earn net average monthly income 10 of IDR 3.7 million (US$281), nearly four times their average wages prior to migrating. Even when the op- portunity costs are taken into consideration, migration is still beneficial. On average, current migrant workers earn the net economic benefits11 of nearly IDR 2.7 mil- lion (US$202) per month. Female migrant workers are among the largest beneficiaries from having access to jobs abroad. While the average net monthly wages for fe- male migrants abroad are still lower than male migrants (IDR 3.4 million vs. IDR 4.0 million), female migrants increase their earnings abroad by a much larger average net ratio12 of 5.3 times their previous jobs, compared with the men’s average ratio of 3.6 (Figure 2.2). Migration and remittances also register positive im- pacts on socioeconomic aspects of migrants’ house- holds. As in many other sending countries, remittances from Indonesian migrant workers also contribute to pov- erty reduction in the country (Adams and Cuecuecha, 10 Net average monthly 2011). Moreover, in the case of female migration, their income is the average remittances tend to reduce child labor participation by of migrant worker’s monthly salary during anywhere from 17 to 32 percentage points, without dis- migration after deducted couraging labor force participation among remaining by monetary migration household members (Nguyen and Purnamasari, 2014). cost. 11 The net economic benefit of migration is Migration also improves long-term employment pros- the difference between income during migration pects. Former migrant workers are more likely to enter and foregone domestic the labor market after returning from abroad. Prior to income after deducted migration, the majority of former migrant workers did by monetary migration cost. It includes not only not work or do any paid work (around 60 percent). This the total net income of changes after they return home. More than half of for- working abroad, but also mer migrant workers who have returned to Indonesia the opportunity cost represented by the wages engage in paid work (52 percent). Moreover, consistent the worker would have with Acosta’s study (2007) showing that remittance in- been able to obtain by staying in their previous comes are associated with increases in entrepreneurial job in Indonesia. activities and business ownership in El Salvador, nearly 12 The net income ratio one-third of former migrant workers in Indonesia report- is the ratio between net monthly income during ed setting up a small business with remittance income migration and income that is still running today. prior migration. Page 25 Indonesia’s Global Workers Risks of Migration A t the same time, working with only 30 percent among former migrant abroad can be a risky propo- workers), 80 percent of them can also have sition. Migrant workers face days off (compared with 66 percent among numerous risks at different former migrant workers). Unfortunately, no stages of the migration pro- improvement has been seen in the issues cess, ranging from physical relating to salary, such as late payment, or and sexual abuse and violence, to econom- retained and lower salary paid than agreed. ic exploitation and mistreatment through the denial of basic freedoms and standard The risk of bad and traumatic experienc- conditions of employment. While an em- es, however, varies across the gender of mi- ployment contract is the legal foundation grant workers and the countries to which that stipulates the rights and responsibilities they migrate. Risks related to working con- of a migrant worker and his/her employer, ditions and abuse are more likely faced by only about one-third of current Indonesian female migrant workers. Albeit at low levels, migrant workers sign a contract of employ- the episodes of abuse among female migrant ment prior to departure. About 56 percent of workers are double those of male migrant all current migrant workers only know their workers. On the other hand, male migrant salary level after arriving in the destination workers who are mainly undocumented are country. more vulnerable to salary-related problems. In general, however, relatively few migrant In general, the incidence of bad and trau- workers have negative experiences related to matic experiences has declined in recent their salary, as the great majority of migrant years. The incidence of abuse (physical workers receive their salary on time and at or psychological) and harassment has de- the agreed amount. Looking across different clined from 8 percent among former mi- destination countries, negative experiences grant workers to 4 percent among current are less common among current migrants The incidence migrant workers. A similar phenomenon who work in more developed countries, of bad and is also observed concerning work-related mainly Chinese Taipei, Hong Kong SAR traumatic problems. Among current migrants, the in- cidence of working excessively long hours and Singapore. Migrant workers in Malay- sia experience more problems related to sal- experiences is half of that seen among former migrant ary, while those who work in Middle-Eastern has declined in workers (12 vs. 21 percent). Moreover, while more current migrant workers (46 percent) countries are the most likely to receive bad treatment related to working conditions and recent years now receive overtime payments (compared abuse (Table 2.1). Page 26 Who Are Indonesia’s Migrant Workers? Why Do They Migrate? Table 2.1 Incidence of negative and traumatic experiences encountered by current migrant worker (%) Negative Gender Legal Status Main destination experience Male Female Documented Undocumented Malaysia Developed Middle East countries Salary related Lower salary 12 5 7 10 12 4 4 than agreed Late salary 17 11 10 18 18 6 14 payment Retained 10 6 4 10 10 3 6 salary Work related Do not get 12 73 52 55 19 51 84 overtime allowance Have too long 7 18 16 10 9 11 27 working hours Heavy 15 17 16 16 16 12 22 workload Do not receive 6 30 24 17 11 15 48 days off Abuse/harassment Physical abuse 1 2 2 2 1 1 5 Psychological 2 5 4 2 2 4 7 abuse Sexual 1 3 2 2 1 1 6 harassment/ assault Source: World Bank Indonesia’s International Migration and Remittances Survey 2013/14. Figure 2.3 The incidence of negative experiences is in decline Former migrants Current migrants 39% Work-related problems 25% 24% Salary-related problems 10% 8% Abuse/harassment 4% Source: World Bank Indonesia’s International Migration and Remittances Survey 2013/14. Page 27 Indonesia’s Global Workers Main Profiles Table 2.2 Current migrant workers’ characteristics, by profile (%) of Migrant Characteristics Female domestic Migrant workers in Undocumented male workers in Workers workers in the Middle developed countries Malaysia (Profile 3) East (Profile 2) (Profile 1) P Share from migrant workers revious migration policies have Indonesian been largely driven by efforts to Current migrants 13 27 26 protect one distinct group of mi- migrant Area of origin grant workers, namely female do- workers Urban 32 34 18 mestic workers who are more likely to be mistreated. The current administration’s cannot be Rural 68 66 82 first approach to migration policy was root- represented Destination country ed in its efforts to protect female migrant workers going to the Middle East. This pro- by a single Malaysia 0 0 100 file represents the group that first comes profile Middle East 100 0 0 to mind when people think of Indonesian Chinese Taipei 0 38 0 migrant workers. The Middle East, partic- ularly Saudi Arabia, is the traditional desti- Singapore 0 19 0 nation for Indonesian migrant workers ini- Hong Kong SAR 0 23 0 tially because of the religious ties in relation Others 0 19 0 to the Hajj pilgrimage. Labor migration to the Middle East is generally officially regu- Gender lated and dominated by females who work Female 100 74 0 mainly as domestic workers. Today, how- Male 0 26 100 ever, this first profile only comprises about 13 percent of total current migrant workers. Type of job overseas Domestic worker 100 69 1 But Indonesian migrant workers cannot be represented by a single profile. There are Farm worker 0 2 37 many types of workers who choose to work Construction 0 5 42 abroad, for different reasons, and who have worker different experiences. Among these many Factory worker 0 12 7 types, there are two additional major groups of migrant workers who outnumber migrant Other 0 6 8 workers to the Middle East. The second Activity prior migrating profile consists of migrant workers who Paid worker 16 32 64 are working in more developed countries, mainly Chinese Taipei, Hong Kong SAR138 Unpaid worker 8 5 19 and Singapore. This group, largely females Attended school 1 6 5 working as domestic workers, constitutes Housekeeping 74 50 3 about 27 percent of current migrant workers. The third profile comprises undocument- Unemployed 1 4 6 13 In Profile 2, while ed male migrant workers going to Malaysia Chinese Taipei, Hong Educational attainment Kong SAR and Singapore (Table 2.2). Given Indonesia’s proximity to comprise the bulk, at 79 Elementary 69 28 57 Malaysia, historically many Indonesians percent, other countries also included are the school or below have crossed the relatively porous border US (2 percent), Brunei Middle school 26 39 25 with Malaysia for various reasons, including Darussalam (13 percent), to work. Among the various types of work, Japan (1 percent) and High school or 5 33 19 jobs on farms and in construction are the the Rep. of Korea (6 percent). higher most popular among Indonesian male mi- 14 In addition to the 80 Legal status grant workers in Malaysia, especially those percent of workers in Profile 3 who work in ag- Documented 68 76 0 working illegally. This is the largest group of riculture and construc- undocumented male workers, constituting tion, the other job types Undocumented 32 24 100 about 26 percent of total current migrant include domestic workers (1 percent), factory workers, of which about 80 percent work in workers (7 percent) and Source: World Bank Indonesia’s International Migration and Remittances agriculture and construction. 14 others (8 percent). Survey 2013/14. Page 28 Who Are Indonesia’s Migrant Workers? Why Do They Migrate? These three particular profiles help in ar- ticulating the forefront issues regarding the Main migrant current debate on migration policy. Mora- worker toria are largely in response to risks faced profiles, by by female domestic workers in higher-risk share locations, represented by Profile 1 (i.e., all fe- male domestic workers in the Middle East). Meanwhile, encountering very high num- bers of undocumented migrant workers, the PROFILE 1 government is also undertaking measures Female domestic to improve documentation, the challenges workers in the particularly faced by Profile 3. Ultimately, Middle East 13% in the case where working overseas offers significantly higher economic benefits, as mostly characterized by Profile 2, the gov- ernment needs to pay more attention to pol- icies aimed at channeling higher incomes from migration, not only into short-term goals such as raising consumption, but also into long-term productive investments. The PROFILE 2 exposure to risks and opportunities differs Migrant workers across migrants and these three profiles in developed countries 27% provide useful insights into which policies might work best to reduce these risks and increase the economic benefits from mi- gration. This report, therefore, focuses on these three profiles—accounting for about two-third of total Indonesian migrant work- ers currently abroad—to highlight the dif- ferent experiences of Indonesia’s migrant workers. The benefit of this approach is that PROFILE 3 we can better understand the complexity of Undocumented the numerous characteristics of Indonesian male workers in migrant workers in order to be able to de- Malaysia 26% sign smart policy solutions to address their main vulnerabilities in a more comprehen- sive way. This will be useful when consid- ering how different policies are required to meet the various needs represented by each profile, and the impossibility of trying to use one policy to fit all profiles. Protecting P. 2 9 Female Migrant Domestic Workers Historically, Indonesian migrant workers have been dominated by women, but this has changed in recent years. According to BNP2TKI placement data, in 2009 more than 80 percent of all documented migrant workers were female, but since then this number has fallen to just 62 percent in 2016 (Figure 3.1). This rapidly declining trend is stronger if undocumented migrants are also taken into account, in which case the share of female migrants is down from a majority of 65 percent among former migrant workers to about 50 percent among current migrant workers. Ch.3 Page 31 Indonesia’s Global Workers M ost female migrants go abroad by finding jobs as Figure 3.1 domestic workers. Over- Decreasing trend in total documented migrants, particularly women all, 40 percent of current (thousand and %) migrants are employed as domestic workers, 94 percent of whom are female. Although the share of domes- Number of migrants (thousands) Percentage tic workers among migrants has declined over time, the domination of this type of job among female migrants is still highly evi- 800 100 dent: 87 percent of former female migrants P L AC E M E N T O F D O CU M E N T E D M I G R A N T W O R K E R S were domestic workers, compared with 77 percent of current female migrants. 80 600 For many female migrant workers, a job Share of Female abroad is their first experience of paid 60 work. Overall, 9 percent current female migrant workers reported that prior to mi- 400 grating they were unpaid workers (Table 40 3.1). Another 63 percent were engaged in housekeeping. This background is even Female more prevalent among female migrants who 200 become domestic workers. Only 16 percent 20 of those female domestic workers going to Middle-Eastern countries reported that Male they were engaged in paid work before they 0 0 migrated (and 19 percent of those going to 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 developed countries). This is very different from men, where 67 percent were engaged in paid work and 14 percent were in unpaid Source: BNP2TKI work before they migrated. For those women who did have paid jobs in Indonesia prior to migrating, low wages and underemployment were significant issues that they faced. Female migrant workers going to the Middle East, who mostly have low levels of education, had average wages Table 3.1 of only IDR 465,000 (US$35) per month prior Current migrant workers’ activity prior migrating (%) to migration. This is lower than female mi- grant workers going to the developed coun- tries, who are slightly better educated, who Previous Male Female Female Female made IDR 700,000 (US$53) per month prior Activity domestic domestic to migration. These wages are about half of For many workers in the workers in those, on average, earned by female workers Middle East developed with the same educational background who female (Profile 1) countries have full-time jobs. Nonetheless, in general, migrant (65% Profile underemployment in Indonesia is high, par- ticularly among women, affecting 27 percent workers, a 2) Paid worker of female workers in urban areas and 48 per- job abroad 67 21 16 19 Unpaid 14 9 8 5 cent in rural areas (Sakernas, 2016). is their first worker Working abroad, female migrant workers experience Attended 6 4 1 3 can earn over five times what they would expect to earn in Indonesia, even after of paid school taking the costs of migration into account. work Housekeeping 3 63 74 67 61 Page 32 Protecting Female Migrant Domestic Workers % of female domestic workers in Malaysia are undocumented Average monthly wages while abroad for fe- Figure 3.2 male migrant workers are IDR 3.7 million Economic benefits of migration (current female (US$276). In other words, migrant wom- domestic worker) (IDR thousands) en earn, on average and before deducting the costs of migration, 5.8 times more than what they could expect to earn in Indonesia. Middle east Even after taking the costs of migration into 4,826 Malaysia account, the average net wage of female mi- grants is IDR 3.3 million (US$252) per month, Developed countries equivalent to a net income ratio of 5.3. Net income ratio 3,244 3,229 Female migrants with low levels of edu- cation are more likely to find work in the Middle East and Malaysia, while higher ed- 2,517 ucated female migrants tend to move to de- veloped East Asian countries. Differences 1,670 1,553 in educational attainment among migrant workers going to different destination coun- 6.6 961 921 tries are partly in response to the different 5.1 739 4.8 minimum education requirements for the available demand for workers from desti- nation countries. For example, migrants to Chinese Taipei, Hong Kong SAR and Singa- Monthly salary Monthly Monthly net pore working as domestic workers must meet during migration Remittance benefit a minimum education requirement of junior secondary school. Malaysia and the Unit- Source: World Bank Indonesia’s International ed Arab Emirates, on the other hand, allow Migration and Remittances Survey 2013/14. migrant workers with only primary school education to be employed as cleaners. Some women, however, choose to migrate to Mid- dle-Eastern countries for religious reasons. Figure 3.3 Findings from a recent qualitative study on Monetary costs of migration (current female migrant workers in Indonesia (RCA, 2015), domestic worker) (IDR thousands) for example, highlight the longstanding and close relationship between East Lombok (a predominantly conservative Muslim region) 11,358 and Saudi Arabia. Female domestic workers going to the Mid- dle East earn less than those who migrate to other countries. Female domestic workers going to the Middle East earn, on average, Female IDR 2,517,000 (US$189) per month. This is 5,905 migrant 20 percent lower than those who migrate to Malaysia to work in similar jobs, and only workers half of what their peers earn in more devel- can earn oped East Asia countries, mainly Chinese 2,902 over five Taipei, Hong Kong SAR and Singapore (Fig- ure 3.2). However, the costs of migrating to times what these locations vary, with migrants to the Middle East Malaysia Developed Countries they would Middle East paying less (Figure 3.3). Female domestic workers to the Middle East with expect to jobs prior to migration see their net incomes Source: World Bank Indonesia’s International Migration and earn in increase by a factor of 5.1, compared with 4.8 for those going to Malaysia and 6.6 for those Remittances Survey 2013/14. Indonesia going mainly to Chinese Taipei, Hong Kong Page 33 Indonesia’s Global Workers Table 3.2 Incidence of negative and traumatic experiences by current female domestic workers (%) Negative experience Middle East Malaysia Developed countries Salary related issues Late salary 16 16 6 Lower salary than agreed 4 9 4 Retained salary 9 10 3 Work related issues Long working hours 26 20 16 Heavy workload 22 19 13 No overtime allowance 88 76 66 No days off 52 32 16 Abuse or harassment Psychological abuse 7 3 6 Physical abuse 5 3 2 Sexual harassment/assault 6 0 1 Source: World Bank Indonesia’s International Migration and Remittances Survey 2013/14. SAR and Singapore. Interestingly, despite the lower earnings, on average female domestic workers in the Middle East remit slightly more than those from other countries (Figure 3.2). Not only are female migrant workers to the Middle East less educated and receive less income, but they also face a greater likelihood of mistreatment. The risk of bad or traumatic experiences related to working conditions and abuse are more likely to be faced by female domestic workers in Middle-Eastern countries than elsewhere (Table 3.2): 26 percent have to endure long working hours, 52 percent do not receive any days off, and 88 percent do not receive payment for overtime work. This compares with only about 18, 30, and 73 percent, respectively, of all current female migrant workers who experience similar problems. Meanwhile, salary-related problems are the least prevalent among those working in mainly Chi- nese Taipei, Hong Kong SAR and Singapore. In addition, while about 9 percent of female domestic workers in the Middle East have negative experiences related to physical/psychological abuse or harassment, the incidence of those who suffer such negative experiences among female domestic workers in mainly Chinese Taipei, Hong Kong SAR and Singapore is at least half or even less than in the Middle East. Lack of awareness of rights and lack of legally binding agreements exacerbate the level of negative experiences. The low incidence of bad experiences in mainly Chinese Taipei, Hong Kong SAR and Singapore is potentially not only because these migrant workers are more aware of their salary-related rights, but also because law enforcement is more strongly applied in these developed countries than in the Middle East. On the other hand, the incidence of negative experiences, in particular in sala- ry-related issues, is also still relatively high among domestic workers in Malaysia. This is most likely because many of these migrants are undocumented (61 percent) and, in the absence of legal agreements, they do not have the legal power to stand up for their rights.The current administration has identified the protection of migrant workers as one of its key policy priorities. The importance of protecting the safety of Indonesia’s overseas migrant workers has increased since the start of President Joko Widodo’s administration in October 2014. This emphasis was first seen in the Nawa Cita—a Sanskrit term for nine programs—with the main agenda including “building capacity to protect the safety of Indonesian over- seas migrants, with special attention to Indonesian migrant workers’ protection” as a national priority. The current In the past, the government responded to higher risk levels in Malaysia and the Middle East by issuing moratoria to prevent female domestic workers from travelling to these countries. In 2009, the govern- administration ment placed a moratorium on female domestic workers going to Malaysia in response to the growing has identified the protection of number of abuse cases, including unpaid wages, physical and sexual abuse, and forced labor. This mor- atorium was lifted in 2011 after both countries came to an agreement on improving migrant workers’ conditions and implementing protection measures. In addition, after selectively applying moratoria to migrant workers Middle-Eastern countries starting with Saudi Arabia in 2011, the government decided to broaden the policy in May 2015 to terminate the placement of Indonesia domestic workers to 21 countries across as one of its key the Middle East, North and East Africa, and Pakistan. The policy was enacted in response to human policy priorities Page 34 Protecting Female Migrant Domestic Workers Box 3.1 Roadmap towards zero domestic workers by 2017 In recent years, concerns have been in- creasing over the abuse and exploita- tion of Indonesian migrant workers, particularly women working as domes- tic workers. In response, the govern- ment has taken measures to improve the protection of domestic workers. One of the responses, proposed by the previous administration in 2011, includ- trafficking issues, the violation of labor norms, low salaries, the absence of a ed a draft Roadmap towards Zero Do- policy on migrant workers’ protection, and the prevalence of a kafalah culture, mestic Workers by 2017. The aim of the whereby employers’ rights override any employment contracts or official labor Roadmap was to stop sending informal regulations. During 2011, the government also considered introducing a total domestic workers abroad. The proposed ban on the placement of informal migrant workers by introducing the Roadmap ban covered those working for individu- toward Zero Domestic Workers by 2017 (Box 3.1).These moratoria had the unin- al employers or in the domestic sphere, tended consequence of increasing unemployment in the domestic labor market such as housekeepers, babysitters, in the migrant sending areas, in particular among low-educated women. Based caregivers and drivers. on studies of the impact of the moratoria policy on local labor markets (Makovec et al., 2016), it appears that local labor market conditions have deteriorated in The proposed policy was contentious, the sending provinces most exposed to the restrictions since the government’s generating considerable debate among moratoria have been implemented. This is probably due to a lack of alternative civil society groups active on labor mi- job opportunities for prospective migrant workers. Aggregate employment and gration issues. Many of the concerns labor force participation rates dropped by about 2 percentage points in the two centered around the possibility that years following the introduction of the first moratorium on Malaysia, with larg- the proposed ban would push domestic er declines in both employment and participation rates for women, at 3 and 4 workers into undocumented channels, percentage points, respectively. Given that most female migration is from poor exposing them to greater risk. These rural areas, one of the unintended consequences of the moratoria policy is that concerns were confirmed by research unemployment rates have increased in the main sending provinces that tend into the consequences of moratoria to be poorer, particularly among low-skilled female job seekers. that Indonesia had issued in the past. Another unintended consequence of the policy on moratoria was that it pushed more women into undocumented migration, exposing them to even higher lev- The proposed Roadmap never pro- els of risk. During the period of the moratorium on Malaysia, between 2010 and gressed beyond the draft stage. Al- 2011, number of undocumented female domestic workers to Malaysia increased though discussed by some officials and by 58 percent compared with those in the two years prior to the moratorium, i.e., reported in the local media, no formal between 2008 and 2009. In addition, the incidence of negative and traumatic regulation or order was ever issued experiences—sexual abuse/harassment, salary-related issues and work-related by the government. Subsequent poli- issues—was higher during the Malaysian moratorium than before the moratori- cy actions taken by the government, um was imposed or after the moratorium was lifted. Our survey data also show however, indicate a more moderate that there were still Indonesian female domestic migrant workers who went to approach. Through the issuance of Min- some Middle-Eastern countries even after moratoria took effect, confirming ister of Manpower Decree No. 354/2015 that undocumented migration continued to those particular countries. The fact the government will continue to allow that moratoria could have unintentional consequences by aggravating undoc- the placement of domestic workers un- umented migration should not come as a surprise and has been experienced der seven categories of work, namely by other countries, such as the Philippines. From 2011 to 2012, when the Phil- house-keepers (pengurus rumah tang- ippines imposed a moratorium on the placement of domestic workers to Saudi ga), cooks (tukang masak), babysit- Arabia, undocumented migration from the Philippines to Saudi Arabia surged ters (pengasuh bayi), elderly caregivers fourfold, from 1.9 percent in 2010 to 8.4 percent in 2012. In solving this adverse (perawat jompo), drivers (sopir), gar- impact of moratoria, the Philippines focused on negotiating a legally binding deners (tukang taman), and child care- bilateral agreement with Saudi Arabia that resulted in the better protection for givers (pengasuh anak). Filipino domestic workers (Box 3.2). Page 35 Indonesia’s Global Workers The implementation of such moratoria, Box 3.2 however, have different impacts depend- Roadmap towards zero domestic workers by 2017 ing on each popular destination country. Indonesian migrant workers go to vari- In 2011, the Philippines called on Saudi Arabia to double the minimum monthly salary of ous destination countries, to ASEAN and Filipino domestic workers to a new minimum of US$400. The Philippines also issued a new non-ASEAN countries. It is important to rule that Overseas Filipino Workers (OFWs) could only work in countries having bilateral distinguish between labor migration to ASE- agreements with the Philippines, or having ratified United Nations (UN) Conventions AN countries and non-ASEAN countries in assessing the potential impacts of poli- concerning human rights and migrant workers. This consequently led to the Philippines cy decisions. The distinction is important banning Filipino domestic workers from working in Saudi Arabia. Saudi Arabia responded for two reasons: first, the physical distance in turn by ceasing to issue working visas for domestic workers from the Philippines. After between countries, which affects the costs, months of negotiations, the Philippines lifted its moratorium in 2012 when Saudi Arabia and second, the documentary requirements agreed to the US$400 minimum monthly wage for Filipino domestic workers. Following for movement between countries. Within the negotiations, the Philippines signed a bilateral agreement with Saudi Arabia in May ASEAN, people have high mobility between 2013, called a Memorandum of Agreement (MoA), to ensure better protection for Filipino countries due to their relative proximity and domestic workers. This was the first bilateral labor agreement ever entered into by Saudi the freedom of movement permitted with- Arabia. The agreement covers the following: in ASEAN (nationals of ASEAN countries can travel visa-free for up to 30 days). This 1 Implementation of a mutually acceptable recruitment and deployment mobility is evident in cases such as the In- system for Filipino domestic workers in Saudi Arabia. donesia-Malaysia corridor, when the pre- 2 Recruitment of domestic workers through licensed recruitment agencies. vious moratorium did not result in a sus- 3 Prohibiting any charge in the recruitment fee or salary deductions originating tained drop of total migrant workers, only from the recruitment system or any other unauthorized salary deductions. in a shifting from documented migrants to 4 Provision of rights to access support from competent authorities in undocumented migrants. Singapore, which contractual dispute. is as close to Indonesia as Malaysia, how- 5 Enforcement of legal measures for any violation of the rules by recruitment ever, does not exhibit the same share of agencies. undocumented workers as Malaysia. The 6 Resolution of any issues arising from the implementation of the agreement. primary difference between the two desti- nation countries seems to be the level of law The responsibilities of Saudi Arabia are: enforcement, particularly the sanctions on employers for hiring illegal migrant work- 7 Ensuring that recruitment, hiring and placement of Filipino domestic workers ers. In contrast, mobility outside ASEAN is is in accordance with the regulations. much more difficult, due to documentary 8 Ensuring the authenticity of employment contracts. requirements and the physical distance be- 9 Opening bank accounts for Filipino domestic workers. tween countries. This is evident in the much 10 Providing a 24-hour mechanism for Filipino domestic workers’ assistance. lower shares of undocumented Indonesian 11 Facilitating rapid settlement of contract violations. migrants going to destination countries 12 Facilitating exit visas in the case of emergency or repatriation. outside of ASEAN compared with undocu- mented migrants in Malaysia. Implementa- tion of moratoria in non-ASEAN countries Meanwhile, the responsibilities of the Philippines are: is more likely to be successful, but may also cause a shift of destination for would-be mi- 13 Ensuring that domestic workers is qualified and medically fit. grants to ASEAN countries instead. As the 14 Ensuring that domestic workers are well trained in housework. survey data show, after the implementation 15 Requiring domestic workers be educated in Saudi Arabian laws, culture and ethics. of moratorium on Saudi Arabia, the number 16 Verifying employment contracts issued by recruitment agencies through the of domestic workers going to Singapore and Philippine Embassy/Consulate General in Saudi Arabia. Malaysia increased by 50 to 70 percent from pre-moratorium levels. Under the agreement, the Philippines and Saudi Arabia agreed to follow a Standard Em- ployment Contract stipulating a SR 1,500 (US$400) minimum salary, days off, daily rest The government is trying to introduce cat- periods, paid leave, the non-withholding of passports and documents, and free commu- egories of occupation in an effort to pro- nication and fair treatment. fessionalize the types of work that can be undertaken by domestic workers. The issu- ance of the Minister of Manpower Decree Source: Republic of the Philippines Department of Labor and Employment, 2013. No. 354/2015 is one of the government’s effort for providing better protection for domestic 51 % Page 36 Protecting Female Migrant Domestic Workers Domestic workers, mainly women, con- of total remittances sent by current mi- tribute about grant workers annually workers. This decree states that, following gapore describes “foreign domestic helpers” Reforms to revitalize job creation are need- the International Standard Classification of as being one profession and the Indonesian ed but, if adopted, will take significant time Occupations 2008 and Indonesian Standard request to implement seven job categories to negotiate, implement and translate into Classification of Occupations 2014, there would require a change in the law. While more work opportunities domestically. are seven job categories that can be engaged Brunei has expressed some willingness, A range of reforms that are coherent and in by Indonesian migrant workers employed even it combines some categories, such as aligned across various ministries’ programs by individuals, namely house-keepers (pen- driver and gardener. As if this were not chal- will be needed to stimulate job creation in gurus rumah tangga), cooks (tukang masak), lenging enough, there is also a possibility Indonesia, especially for women in rural ar- babysitters (pengasuh bayi), caregivers to that the extra costs incurred by employers eas. These reforms would need to include a the elderly (perawat jompo), drivers (sopir), would lead them to source migrant workers “grand bargain” between government, em- gardeners (tukang taman), and caregivers from other countries. In what is a competi- ployers and labor unions to overhaul labor to children (pengasuh anak). By stipulating tive marketplace for labor, it may be unreal- market regulations and modernize work- that only certified workers can take up jobs istic to try to impose such conditions on des- er protection systems, among others, and overseas, this decree seems to be an effort tination countries if they can source labor would be complex, politically sensitive, and to professionalize the types of work that from less stringent sources elsewhere, such time-consuming. In the meantime, until In- domestic workers can do, and ensure that as Vietnam, Cambodia and the Philippines. donesia is able to generate higher-productiv- each type falls into line with standard work- ity and better paid jobs, migration provides ing conditions of formal workers, including In the longer term, the government as- an important avenue for workers, especially working hours, days off, minimum salaries, pires to provide would-be domestic mi- those with low skills levels, to improve their and health insurance similar to that in the grant workers with work opportunities in livelihoods. formal sector. In addition to the idea of pro- Indonesia, but this will be challenging con- fessionalization, the government has also sidering the slowing pace of job creation In parallel with efforts to create better proposed that migrant workers should not in Indonesia in recent years. Over the 10 domestic job opportunities, the econom- live-in in the homes of employers, but in- years from 2007 to 2016, about 2 million ic benefits of low-skilled female migrant stead live in separate compounds in order jobs were created annually, while the work- workers should be nurtured and enhanced. to avoid any violations of standard working ing age population increased by 2.8 million Domestic workers, mainly women, contrib- conditions. each year. In 2016, however, after a disap- ute about 51 percent of total remittances pointing year for job creation in 2015, there sent by current migrant workers annual- Such initiatives may prove impossible to has been a significant improvement in the ly, meaning that domestic workers remit implement in some countries and may not domestic labor market where nearly 3.6 mil- more than the average Indonesian worker serve towards improving migrant worker lion new jobs were created while the labor abroad. If this percentage is applied to the protection. There are questions over wheth- force increased by about 3 million. None- total remittance figure calculated by Bank er these initiatives to professionalize domes- theless most of these new jobs were in urban Indonesia for 2016, this amounts to IDR 61 tic worker jobs and accommodate workers areas, in the services and trade sectors, and trillion (US$4.6 billion) in remittance re- outside their employers’ houses would help for more educated workers. In rural areas, ceipts. Domestic workers in mainly Chinese to enhance protection of migrant workers. agricultural sector employment decreased Taipei, Hong Kong SAR and Singapore sent There are also questions over whether these by 1.3 million jobs, leaving many of those of more than half of this total sum. These re- initiatives can be implemented and, if so, a productive age either underemployed (36 mittances are important, not only in boost- where the government stands in terms of percent in rural vs. 19 percent in urban) or ing consumption of households but also in progress. The main challenge would be in totally unemployed. Underemployment is making longer-term investments, such as making such proposals attractive to recipi- even higher among female low-skilled work- in education and health, both of which are ent countries. In some destination countries ers: 52 percent in rural vs. 33 percent in ur- essential for welfare improvements, in par- (Hong Kong SAR, Chinese Taipei and Sin- ban areas (Sakernas, 2016). This is one of the ticular among the bottom 40 percent of the gapore), the law requires domestic migrant reasons that makes Indonesia’s rural areas a population. workers to live-in. Furthermore, employ- prime source of low-skilled migrant workers. ment law in both Hong Kong SAR and Sin- Ch.4 Encouraging P. 4 3 Documentation Compliance More than one-quarter of all Indonesian migrant workers are men who work largely for agricultural or construction firms in Malaysia, but without proper documentation. Given Indone- sia’s proximity to Malaysia, many Indonesians can easily cross into Malaysia for work, often without securing legal migrant worker status. Jobs on farms and in construction are the most popular among Indonesian male migrant workers in Malaysia. This group of undocumented migrant workers in Malaysia (as represented by Profile 3) constituted only 16 percent of all former migrant workers. This share, however, has changed over time and now represents 26 percent of all current migrant workers, replacing female domestic workers as the single largest migrant worker group. Page 39 Indonesia’s Global Workers Figure 4.1 Documented Negative experiences of male migrant workers in Undocumented Malaysia during migration (%) Salary-related problems Work-related problems Abuse/harassment Lower salary than agreed Long working hours Physical abuse 14 8 1 13 7 1 Late salary payment No overtime allowance Psychological abuse 14 6 3 22 13 2 Retained salary No days off Sexual harassment / assault 6 7 1 12 5 1 Source: World Bank Indonesia’s International Migration and Remittances Survey 2013/14. T hese undocumented male migrant workers are less susceptible to physical or emotional abuse than fe- male migrant workers, but they are more vulnerable to financial exploitation. The incidence of abuse in general is as low as 1 to 2 percent among male mi- grant workers. But being undocumented migrant workers, they are susceptible to other forms of mistreatment. They do not attend the pre-departure briefing required for documented workers and therefore know less about their legal rights, including the right to a safe environment and working conditions, and they are often not informed of their salary prior to departure. As a result, salary-related problems among undocumented male migrant workers are more evident than those among document- ed male migrants in Malaysia. In general, only 6 percent of male documented migrant workers in Malaysia experience retained sal- aries, while the majority of them (86 percent) receive their salaries on time. The prevalence of retained and late payment salary, how- ever, is about 6-8 percentage points higher among undocumented More than one- migrants. But, there is no significant difference regarding the in- quarter of all cidence of lower salary than initially agreed between documented and undocumented migrant workers (Figure 4.1). Indonesian migrant workers There is little incentive for these migrant workers going to Malay- sia to migrate through legal channels, as they can easily move to are men who Malaysia and earn more as undocumented workers than if work- work largely for ing in Indonesia. The high levels of undocumented migration seen among males going to Malaysia attest to the unattractiveness of agricultural or migrating through official legal channels. Given the proximity to construction firms Malaysia, all that these migrant workers need in order to enter Ma- laysia is a passport, as no visas are required for neighboring ASEAN in Malaysia, but citizens. Undocumented male migrant workers manage to earn without proper higher wages in Malaysia than they would earn if they stayed in Indonesia. Their net income ratio is 4 with an average monthly documentation salary of IDR 3.9 million (US$290). Page 40 Encouraging Documentation Compliance Figure 4.2 Duration of migration preparation (current male migrants in Malaysia) (%) Documented Undocumented 1 month or less 30 47 2 months 17 15 Moreover, the process of becoming a documented worker is burdensome and time-consuming. The documentary requirements to become a documented migrant worker are onerous and create a disincentive for prospective migrants to choose to go down the doc- umented path. According to BNP2TKI, the general process comprises 22 separate administrative steps to complete.15 Moreover, the extra time required to become documented is a further disincentive, with almost half of all documented migrant workers having to wait 3 or 3 months or more more months to migrate, while most undocumented mi- grant workers have to wait 2 months or less (Figure 4.2). Documented migration also comes at a higher cost. The average total cost of documented migration is near- ly 52 percent higher than undocumented migration. In 48 29 nominal terms, the average difference amounts to IDR 3 million, which is equivalent to 83 percent of the value of Indonesia’s 2014 poverty line. This means that migrant workers, who often come from economically disadvan- taged households, may have difficulty in paying for these costs up front. Although these costs can be quickly re- covered after a few months of working abroad, a psycho- logical effect known as “loss aversion”, whereby people display a strong preference for avoiding to suffer a short- term loss than acquire a longer-term gain (Kahneman and Tversky, 1984), may dissuade prospective migrant 15 Please refer to Annex Source: World Bank Indonesia’s International II for the complete steps Migration and Remittances Survey 2013/14. workers from taking the risk of paying a large up-front to become documented expense to become documented. migrant workers. Page 41 Indonesia’s Global Workers With today’s lower costs of migration, on average a documented Figure 4.3 Documented migrant worker is now slightly better off financially than an undoc- Monthly net benefit by type of job Undocumented umented migrant worker. The average earnings of documented In- (male migrants in Malaysia) donesian migrant workers are generally higher than undocumented (IDR millions) migrant workers. The net benefits of migration, however, can differ significantly based on the cost of migration, which is determined by destination country, and the sector of employment. Today, given the falling cost of documented migration, being a documented mi- Former Migrants grant worker now yields slightly higher net benefits than migrating through unofficial channels, except for construction workers (Figure 4.3). What is rather promising is that this was not the case among former undocumented migrant workers, with the sole exception of farm workers, who were economically better off if they remained documented. The cost of migration for farm, construction, and factory workers is lower among current migrant workers than those among former workers (Figure 4.4). Meanwhile, lack of access to information is still a major constraint to becoming documented. Survey data show that documented mi- grant workers are more likely (70 percent) to come from households that are aware of the requirements and risks of being a migrant worker. However, only about 60 percent of migrant households know how to find work overseas through the proper legal process. Migrant workers’ low educational attainment seems to contribute towards high dependency on obtaining information only from mid- 8.8 2.0 3.5 1.6 1.5 1.5 1.4 3.1 dle-men rather than from representative agents. Meanwhile, as our Farm worker Construction Factory Other findings indicate, having a relationship with a person involved in worker worker recruitment and placement increases the probability of becoming a documented migrant worker. Current Migrants Lack of access to information is still a major 4.3 2.9 2.2 3.2 2.4 3.7 1.5 1.1 constraint Farm worker Construction Factory Other worker worker to becoming documented Source: World Bank Indonesia’s International Migration and Remittances Survey 2013/14. Page 42 Encouraging Documentation Compliance Figure 4.4 Documented Average monetary migration cost (male Undocumented migrants in Malaysia) (IDR millions) Former Migrants Current Migrants 10.3 12.5 6.6 4.6 8.2 5.9 4.2 5.6 4.4 5.8 2.0 5.3 5.5 3.5 7.5 5.1 Farm worker Construction Factory Other Farm worker Construction Factory Other 40 worker worker worker worker Source: World Bank Indonesia’s International Migration and Remittances Survey 2013/14. %of migrant households do not know how to find work overseas through the proper legal process However, flows of undocumented mi- grant workers, particularly to Malaysia, will be difficult to monitor given the ease of movement between the two countries. Indonesian workers migrate primarily to earn higher incomes. This means that both parties—the migrant workers and the Ma- laysian employers—have a similar interest in avoiding the extra costs and administra- tive burdens of using the legal documented channel. In striving to lower undocumented migration, this will require a strong commit- ment from both Indonesia, to address its migrant workers’ interests, and Malaysia, to address the employers’ interests. However, rather than resorting to sanctions, the best strategy in addressing undocumented mi- gration is likely to lie in reducing the various barriers to documentation, to make it easier, faster and less expensive. Page 43 Indonesia’s Global Workers Indonesia has undertaken a number of initiatives to make the documentation process simpler, faster and less costly Indonesia has undertaken a number of initiatives to make the documentation process simpler, faster and less costly. To provide some examples, the government has recently in- troduced its Integrated One-Gate System (Layanan Terpadu Satu Atap, or LTSA) centers to provide an easier, cheaper, faster and more transparent placement process for prospec- tive migrant workers. According to BNP2TKI, since the LTSA in Mataram (West Nusa Tenggara) was established in 2008, the number of deported migrant workers origi- nally from West Nusa Tenggara has fallen by 50 percent, indicating a reduction of undocumented migration from the region. However, besides Mataram, LTSA offices have only been established in Gianyar (Bali), Nunukan (North Kalimantan), and Indramayu (West Java). This means that there are still many prospective migrant workers from other regions who continue to face a long, complicated and costly process to become documented migrant workers. Moreover, currently only LTSA Nunukan dan Indramayu that have all required representatives of civil registration, employment records, medical check-ups, and immigration located in the same office. The government is also trying to address the issue of finan- cial constraints preventing migrants from becoming doc- umented. Since November 2015, the government has been providing small loans in the form of state-bank-sponsored People’s Business Credit (Kredit Usaha Rakyat, or KUR) for prospective migrant workers to finance placement fees at a subsidized interest rate of 9 percent (previously banks had been demanding 33 percent for such small loans). Crucial- ly, these loans can be provided without the need for any collateral. Six banks are involved in the program. However, implementation is less than ideal, as the banks involved still require complicated procedures to be followed and the repayment obligations sometimes lie with recruitment agencies. As a result, take-up has been very low because the application process takes so long that migrants often leave before receiving the credit, and repayment obligations are undertaken in-person by the Private Placement Company for Indonesian Migrant Workers (Pelaksana Penempatan Tenaga Kerja Indonesia Swasta, or PPTKIS) rather than automatically, increasing the cost for KUR recipients. Page 44 Encouraging Documentation Compliance Reforms in the Philippines show how to promote safe and documented migration There are a number of examples of cross-country experience to facilitate and Box 4.1 promote safe and documented migration. In 2010, the Vietnam Association for The Philippines’ efforts to streamline Manpower Supply—an association of sending agencies—in collaboration with migrant documentation International Labor Organization (ILO), developed a code of conduct (CoC) for the sending agencies to enforce the placement process and ensure that it Several measures have been undertaken in is in accordance with Vietnamese laws and international labor standards. The the Philippines to encourage documenta- Vietnamese government also introduced its 62 Poorest Districts Programs, which include programs to facilitate international labor migration in districts tion, as follows: considered to have an abundance of unskilled workers. The facilitation includes the implementation of subsidized training, travel costs and preferential credit Hassle-free recruitment: Prospective OFWs policies. To discourage overstaying of migrant workers after finishing their only need to contact a licensed recruit- official contracts, recruitment agencies require migrant workers to put down a ment agent to have all their documen- deposit that can only be retrieved upon their return, along with the interest ac- tation take care of, including submission crued. Meanwhile, the Philippines has for several years been at pains to reduce to the Philippines Overseas Employment undocumented migration and its efforts have paid off with a gradual reduction Administration (POEA). The agent also from about 27 percent in 1997 to 11 percent in 2011 (Box 4.1). Although, there collects contributions from employers and was a slight increase in 2011-12, driven by a sudden surge in undocumented mi- pays the recruitment fee to the POEA. gration to Saudi Arabia, as a result of a moratorium imposed by the Philippines on the placement of domestic workers to Saudi Arabia. Recruitment fee exemption for low-skilled OFWs: Prospective OFWs only pay recruit- Migrant worker receiving countries can also play a role in reducing undoc- ment fees equal to one month’s salary and umented migrant worker flows. Malaysia has amended its immigration law, documentation fees, while the employer as well as introduced some programs in its efforts to reduce undocumented pays all other fees, visa costs and the air- migrants. Under the current Immigration Act 1959/63, penalties for immigra- fare. Low-skilled workers, such as domes- tion law violations do not only apply to undocumented migrants but also to tic workers, caregivers and seafarers, are their employers. However, the sanctions are currently enforced more heavily exempt from recruitment fees. on the offending workers rather than their employers. In addition to the law, Malaysia has introduced a program to prevent undocumented migrants from Integrated digital process: An integrated entering Malaysia by patrolling land and sea borders. Another program aims database system called E-Link connects all to detect, detain and deport undocumented migrants already in the country relevant government agencies for contract (World Bank, 2015). processing, credential processing and au- thentication, and passport applications. Some migrant worker receiving countries have also made efforts to encour- Prospective OFWs can register online with- age documentation. France is an example of a receiving country that has been out having to go to a POEA office, which successful in encouraging documented migration. France’s Universal Service makes the registration process easier and Employment Check was established in the 1993 to encourage employers to safer. hire declared domestic workers. The scheme provides a 50 percent deduction in the annual salary paid to declared domestic workers through income tax credits of a maximum EUR 1,830 per year. Over the period 1993 to 2000, the Sources: Commission on Filipinos Overseas, 2015; implementation of this scheme resulted in an estimated 20 percent of migrant International Organization for Migration, 2013; Manlulo, B., n.d. workers originally employed illegally in as domestic workers becoming officially employed (Le Feuvre, 2000). P. 4 5 Ch.5 Sustaining the Benefits of Labor Migration Economic benefits from international migration vary across types of migrant worker. Overall while workers benefit from international migration, the level of the benefits differs among different groups of migrants. Such differences are mostly affected by costs paid and salary earned by migrant workers, together with the types of job and destination country. Among Indone- sian migrant workers, Profile 2 (migrants who work in devel- oped countries, mainly Chinese Taipei, Hong Kong SAR and Singapore) have the opportunity to enjoy the highest monthly net benefits compared with other migrants, despite the higher costs they also incur to migrate (Figure 5.1). Looking further into the characteristics of Profile 2 migrant workers, the higher level of education possessed by this group clearly corresponds to the higher level of economic benefits they earn in comparison with other groups of migrant workers. Profile 2 highlights the poten- tial positives of labor migration. This section focuses on how such success stories benefit not only migrant workers, but also their families, and considers how the benefits of migration can be sustained even after migrant workers return back to Indonesia. Page 47 Indonesia’s Global Workers Figure 5.1 Income before migration (IDR thousands) Economic benefits of migration by profile Income during migration (IDR thousands) (current migrants) Monthly net benefit (IDR thousands) Net income ratio (Ratio) Profile 1 Profile 2 Profile 3 Female domestic workers Migrant workers in Undocumented Male in the Middle East developed countries workers in Malaysia 5,888 4,423 3412 3,753 3,229 2,386 2,600 1,670 6.3 1,380 5.1 701 4.3 934 465 4.0 Female Male Source: World Bank Indonesia’s International Migration and Remittances Survey 2013/14. M igrant workers normally remit of portion of their earnings back to their f amilies in Indonesia. While the average share of income remit- ted back to Indonesia is about 18 percent, there is a wide variance depending on the type of migrant worker. For exam- ple, migrant domestic workers going to the Middle East have little opportunity to leave their work premises and, even if they do, they have fewer opportunities to spend money than their peers working in more commercial- ized Asia-Pacific cities. As a result, even though they earn relatively less they send more than 38 percent their salaries to their families in Indonesia. Migrant workers to more developed economies in East Asia, on the oth- 18 er hand, remit 17 percent, while undocumented male workers to Malaysia remit just 11 percent. % Increasingly, migrant workers are using regulated channels to remit money, which are both easier and safer. In 2005, it was estimated that only 36 percent of remittances to Indonesia were transmitted through reg- ulated channels (World Bank, 2008). This seems to be changing, perhaps as a result of more and easier access to formal financial services both in sending areas and destination countries. Nonetheless, improving pre-de- parture training covering such important topics as safe average share of banking and regulated remittance channels may have income remitted also contributed to this significant change. More than back to Indonesia 90 percent of current migrants report that they remit through regulated channels (Figure 5.2). Page 48 Sustaining the Benefits of Labor Migration Figure 5.2 Former migrants The main remittances channels used by Current migrants migrant workers (%) 10 28 52 7 9 21 62 7 Money orders Western Union Bank account Brought home Source: World Bank Indonesia’s International Migration and Remittances Survey 2013/14. Since migrant workers usually come from poor and ams and Cuecuecha, 2011). The robust evidence that vulnerable households, remittances have a dispropor- remittances lead to increases in consumption and re- tionately positive impact in helping families to cover ductions in poverty has also been shown in other East their daily expenses. Over 82 percent of surveyed mi- Asia and the Pacific countries, at least in the short run grant worker households reported “daily needs” as being (World Bank, 2014b). Moreover, with remittances play- one of their top three uses for remittance income (Fig- ing an important role in helping to reduce poverty, it ure 5.3). Research shows that the role of remittances in is expected that households can also start to prioritize increasing consumption also reduces the probability of other spending on longer-term goals, such as savings, Indonesian households being poor by 28 percent (Ad- education, and starting a business. Page 49 Indonesia’s Global Workers Figure 5.3 Distribution of migrant households by top three highest remittance uses (current migrants) (%) Male migrant Female migrant Income from migration provides an opportunity Daily needs 88 for workers to cover not 77 only short-term needs, Education 37 but also to make longer- 45 Business capital term investments 12 17 House 31 38 Valuables 11 Income from migration provides a brief window of opportunity for workers to cover 16 Permenaker No. 11 22/2014, the regulation not only short-term needs, but also to make issued by the Minister of longer-term investments. In many cases, Manpower and Trans- Payment for loans (to migrate) age limits are imposed by the Indonesian migration concerning the implementation 33 government and the destination countries of placement and the on migrant workers, generally between 21 protection of Indonesian 19 labor overseas, states and 40 years old.16 This limitation on work- that the job seekers ing life overseas emphasizes the importance interested in working Payment for other loans of migrant workers planning and using their overseas should meet the following age criteria: 20 significantly higher income from migration to be at least 18 years 14 with care, not only for short-term impacts old, except for those during their migration but also longer-term who will be employed by an individual employer, impacts after they return home. Such lon- and should be at least Saving ger-term impacts include starting a small 21 years old, as proven by identity card (KTP) or 21 business, getting a better job than before, electronic identity card or making long-term investments such as in (e-KTP) and birth certif- 22 the education of their children. At present, icate/birth recognition letter from the autho- regardless of the level of income earned, the rized agency. However, Others majority of migrant workers still seem to pay different job in different countries sets different 3 little attention to the longer-term benefits of age limits. For example, the money that comes from their migration. construction workers 9 This is an area where the government could going to Japan need to be no older than 27 years play more role, acknowledging the fact that of age, while G-to-G pro- utilizing remittances for long-term produc- grams for workers going Source: World Bank Indonesia’s International tive investments is also an essential element to the Rep. of Korea need Migration and Remittances Survey 2013/14. to be no older than 39 of overall economic growth. years of age. Page 50 Sustaining the Benefits of Labor Migration Some households, especially those that have female migrant workers, manage to save or invest a portion of their remittance earnings, which helps to sustain the lon- ger-term benefits of migration. About 41 percent of migrant households channel their income from remittances into edu- cation, 15 percent invest that income into business capital, and 22 percent report put- ting the money into savings accounts. The likelihood of making these long-term invest- ments is slightly higher when the migrant worker is a woman (Figure 5.3). Experience from other countries in en- couraging savings and investment among migrant workers’ households could also be useful in helping Indonesia to im- prove its current arrangements. While BNP2TKI currently includes some financial literacy training in the Pre-Departure Brief- ing (Pembekalan Akhir Pemberangkatan, or PAP) module, the PAP is not yet standard- ized. Other countries go rather further. For example, in the Philippines there is an array of financial literacy training programs, both during the pre-departure orientation semi- nar, as well as after returning home to the Philippines. The government also provides investment instruments targeted to return- ing migrant workers, such as the SSS Flexi- Fund program, whereby migrant workers invest their savings in low-risk fixed-income government securities. Similarly, in Sri Lan- ka, the Sri Lanka Bureau of Foreign Employ- ment (SLBFE), together with the Ministry of Education, conducts seminars and other educational programs to educate migrant workers on banking facilities available for remitting money and how such facilities can be used to maximize the benefits on their earnings. In addition, the Sri Lankan gov- ernment has also introduced an entrepre- neurship development program for return- ing migrants, aimed at giving guidance on establishing a business. Bangladesh has also introduced government bonds specifically designed for migrant workers. However, little evaluation of these schemes has been undertaken, so it remains unclear just how effective these schemes are. Page 51 Indonesia’s Global Workers Migrant workers gain skills and experi- ence while abroad, which seems to make them more likely to engage in paid work once they return to Indonesia. Returning migrant workers are more likely to find paid work after they return home. There are dif- ferent possible explanations for this. The returning migrants may be better qualified with additional skills; more experienced and therefore better suited to the domestic labor market; more self-confident in their ability to find work; or, having become accustomed to earning a salary they are more motivat- ed to find work, albeit at a lower wage than they are used to. This is most evident in fe- male migrant workers returning from the Middle East, with paid employment more than doubling from only 15 percent prior to migration to 32 percent after returning. Similarly, migrant workers who worked in East Asian economies, not including Malay- sia, experience an increase in paid employ- ability of about 5 percentage points. People who worked both before and after their time abroad tend to remain in their previous sec- tors of work, a phenomenon most prevalent in agriculture and trade, where about two- thirds of people stayed within these sectors. More research is needed, however, to uncov- er the most effective approaches in support- ing these returnees to find paid work. Migrant workers gain skills and experience while abroad, making them more likely to engage in paid work once they return to Indonesia Page 52 Sustaining the Benefits of Labor Migration Figure 5.4 Returning migrants engaged in paid work for former migrants (%) After migration 49 Before migration % P RO F I L E 1 Female domestic workers in Middle East 32 15 of female migrant workers fall out of the labor force after returning home P RO F I L E 2 Migrant workers in developed countries 30 27 Even so, almost half of female migrant workers fall out of the active Female labor force after returning home. Despite the increase in the num- 86 ber of previously unemployed migrant workers finding work after they return home, many women fall out of the active labor force and 75 become unemployed again on their return home. The majority of undocumented male workers returning from Malaysia were in paid work before migration, but this rose from 73 percent to 85 percent once they returned home. About 68 percent of female domestic mi- Male grant workers from the Middle East, however, returned to unpaid activity once back in Indonesia (Figure 5.4). Hence, there is still a very wide gap between the employability of returning female mi- grant workers and returning male migrant workers in their provinces. Useful experiences from other countries can be borrowed to help P RO F I L E 3 Undocumented male returning migrant workers with the transition back into the domes- workers in Malaysia tic labor market. Indonesia could do more to help migrant workers, especially women from rural origins, transition back into the labor 85 force once they return home. The experience from other countries could be useful here. For example, in the Philippines training is 73 provided by the Overseas Workers Welfare Administration (OWWA) in entrepreneurial skills and financial literacy to prepare OFWs to return to the national job market. In addition, the Philippines government provides “livelihood loans” to returning migrants to support them in starting a small business. In Sri Lanka, there is a nationwide network of returnee migrant workers called the “Rata- viruwo” Organization, which provides support to improve the socio- economic condition of migrant workers and their families, with a Source: World Bank Indonesia’s International Migration special focus on helping children left behind by departing migrant and Remittances Survey 2013/14. worker parents. In most cases, however, it is unclear whether various governments’ support provided post-return are effective. Recommendations P. 5 3 P. 5 7 International Migration Sector: Professionalizing and Modernizing the Jobs Marketplace P. 6 1 Preparing Migrants before They Leave: Streamlining the Documentation and Pre- Departure Process P. 6 3 Protecting Migrants while They Are Abroad: Raising the Bar on Protection P. 6 7 After Migrants Return: Sustaining the Benefits of the Migration Experience and Remittances P. 6 9 Good Governance: Revisiting Institutional Arrangements and Introducing Better Monitoring and Evaluation Creating more inclusive and better-paid jobs in Indonesia would provide prospective migrant workers with attractive and competitive opportunities at home, as a viable alter- native to working overseas. Prospective migrants might no longer need to consider migration and the prospect of being separated from their families as the only option—but just one possible competitive alternative—if attractive job opportuni- ties were available at home in Indonesia. Indeed, achieving this is the government’s intention and longer-term goal. How- ever, there is also a realization that, given the slowing pace of job creation in Indonesia in recent years and the deep structur- al reforms needed, achieving this goal will take considerable time and effort. Ch.6 Page 55 Indonesia’s Global Workers While generating more and better quality jobs is a long-term goal, in the interim migration still play a valuable role as a short- to medium-term contribution to poverty reduction and development. Creating more inclusive and higher-earning employment opportunities will call for a structural transformation, as well as a range of mul- tifaceted reforms that would be politically challenging and time-consuming to agree. These reforms would need to include: addressing constraints and barriers to productivity growth, particularly through better infrastructure and greater competitiveness; revamping the skills training system to better meet industry demands; and negoti- ating and implementing a “grand bargain” between various government ministries and agencies, employers and labor unions to overhaul labor-market regulations and provide more effective worker protection. For this reason, migration provides an important opportunity for higher-earning jobs in the short- to medium-term, especially for low-skilled workers with few if any other options. To increase its impact on development, there is a need to facilitate migration, which calls for further policy reforms that provide optimal migration opportunities for potential migrant workers. The government recog- nizes the importance of international labor migration and the resulting remittances for many Indonesians, their families and the country, especially those with low skill levels who have few opportunities for work in Indonesia, particularly in their local regions. While the government is striving to implement policies to maximize the benefits of and minimize the risks of migration, it needs to go one step further to ensure that these policies become part of a national jobs strategy and are mainstreamed into national development plans. Three core objectives should underpin the guiding principles of an overarching labor migration policy framework: (i) providing additional em- ployment opportunities for all Indonesians, in particular the low-skilled and women; (ii) promoting and protect- ing the rights of migrant workers throughout the migration cycle; and (iii) improving reintegration of returning migrants into the Indonesian economy. Page 56 Recommendations Box 6.1 Short-term Priority Actions A strategic reform to incorporate international labor migration into the development agenda requires comprehensive medium- Indonesia is now and long-terms policies and programs. Nonetheless, there are well-placed to take several quick wins that could be considered and implemented by the government in the next couple of years. These few identified effective action on actions are considered to be high priority because: they are likely this issue to have an impact on improving the welfare of low-skilled mi- grants and their families, they are feasible to achieve given the available resources and time frame, and they are most likely to bear sustainable development impacts. Proposed short-term priority actions that would be carried forward into the next stage of reform in the migrant worker sector, include: Develop a comprehensive information dissemination strategy. Such a strategy is needed to share the benefits of migration more widely, reduce undocumented migration through better knowl- edge on the benefits of migrating through the formal chan- nel, provide better job-matching outcomes, protect migrants through greater awareness of their rights and mechanisms of redress, and ensure greater accountability of the private sector and government actors by removing asymmetric information lead- ing to an efficient platform for job-matching. Implementing the strategy should rely on new and diverse approaches for identifying the right messengers to employ, the audience to target, the mes- sages to deliver and the dissemination channels to use to ensure that the information reaches those who would benefit most from it. Continue ongoing efforts to accelerate and streamline the mi- grant worker documentation process. To embrace an efficient process, the current 22 documentation steps need to be cut in half by eliminating unnecessary documents (e.g., approval let- ter from the village head), combining some stages (e.g., attending socialization with consultation on job orders) and removing dupli- cation (e.g., obtaining a certificate of attendance on training or- ganized by PPTKIS vs obtaining a skill competency certificate from a professional certifying agency). Such simplification would poten- tially accelerate the current average time from 2-3 months down to 1 month. Moreover, to lower documentation costs and make them more transparent, some components of the expenses that are reg- ulated and standard, such as obtaining a passport, an accredited skill certificate, and a medical check-up, could be paid directly to the service provider instead of being included in the placement cost A set of comprehensive and coherent polices is needed to address structure. The effort could be enhanced by expanding the establish- the concerns surrounding Indonesian labor migration. As this re- ment of the LTSA17 to all major migrant worker-sending provinces port shows, the issue of Indonesian labor migration is broad-rang- to make the documentation process simpler, faster and cheaper. ing, complex and often emotive. However, provided with newly developed empirical evidence and learning carefully from interna- Establish a monitoring and evaluation (M&E) system to help sup- tional experience and best practice, Indonesia is now better placed to take effective action on this issue. The government can consider port evidence-based policy reform for migration policy and pro- all of the available evidence and develop the best possible policy mix grams. An effective M&E system would provide the government to provide better protection for migrant workers with vastly differ- with a tool to manage policy interventions and ensure account- ent profiles and characteristics, and also enhance the development ability, and would in turn contribute to improving migration poli- impacts of labor migration. cy practices in the longer term. While a coherent system could be developed incrementally, the government could start first by de- The government is currently undertaking measures that aim to im- signing an M&E framework as an integral part of any new program, prove both the protection and documentation of migrant workers. such as the Desmigratif program, for example. Having an embed- These ongoing initiatives, however, need to be coordinated, expand- ded M&E framework within Desmigratif would enable the govern- ed and improved to achieve the full potential long-term development ment to understand the ways in which the program drives change impact of international migration. The following recommendations and help to improve its future implementation. Furthermore, learn- grouped into five categories would serve to professionalize the mi- ing from the experience of Desmigratif’s M&E system, this approach grant worker labor market, improve its efficiency and the coordi- could then be applied elsewhere by the government to better inte- nation of the sector, and maximize its potential for the benefit of grate such M&E frameworks into other policies and programs. all stakeholders. Meanwhile, the box below provides a shortlist of 17 Details regarding the LTSA mechanism are provided in Section 2. priority actions that could be undertaken in the short term. Page 57 Indonesia’s Global Workers Page 58 Recommendations 1 INTERNATIONAL MIGRATION SECTOR: PROFESSIONALIZING & MODERNIZING THE JOBS MARKETPLACE International labor migration should be recognized as an important sector of the Indo- nesian economy in its own right, requiring commensurate efforts to improve its profes- sionalism as a sector and instill modernization across its various components. Such an approach would help to place labor migration on a par with other sectors of the economy. The following three reform initiatives could help to spur this process of modernization: A Better linking Indonesia’s migrant workers with international work opportunities Encouraging market development efforts ers in formulating curricula and standardiz- in destination countries should become ing skills. The Indonesian experience with one of the government’s functions. Infor- implementing a Memorandum of Under- mation from labor markets in destination standing (MoU) with the Republic of Ko- countries would help the government (i.e., rea under the Employment Permit System through the designated migration agency) to (EPS)18 suggests that the demand for specif- better understand labor-market operations ic skills, albeit in low-skilled jobs, remains and trends, as well as the challenges in meet- unmet. While many Indonesian workers— ing labor demand, and feed this informa- nearly three times the annual quota agreed 18 EPS is a tempo- tion back into the skills and training process between Indonesia and Korea—are in the rary labor migration at home. Given that Indonesia is current- EPS job pool, the number of Indonesian program through G2G MoUs aimed at avoiding ly adopting the use of labor attachés in its workers actually chosen by EPS employers corruption, extortion, or most important destination countries, the falls below the annual quota owing to mis- abuse during migration. Under the EPS program, government could also consider borrowing matches of skills. Skills development could the migrant workers’ another idea from the Philippines in utiliz- therefore help aspiring migrant workers to recruitment process is ing labor attachés in an information-sharing signal their acquired skill levels, widen the under the control of the government of the Rep. role. The Philippines, through the POEA, choice of available jobs and increase migrant of Korea and the sending leads the way in using information from workers’ wage bargaining power. government, and makes labor markets to inform its migrant-work- the recruitment process more transparent. The er policies. The POEA carries out periodic Full market development therefore relies EPS program provides marketing activities in coordination with on both market research and efforts to im- post-admission benefits. For instance, EPS workers labor attachés, who act as on-site “informa- prove skills/qualification recognition in can access Foreign Work- tion centers” and “distribution outlets” for destination countries. Working together force Support Centers promotional and communication materials, with the Ministry of Foreign Affairs and la- in the Rep. of Korea to file complaints, receive and who play a significant role in market-in- bor attachés, private sector representations, counselling, and join formation generation and the provision of and diaspora associations, in-depth mar- language and cultural feedback (Nonnenmacher, 2006). ket research could be conducted to highlight training. EPS workers also receive mandatory those skills in highest demand and therefore training from the Korean To be globally competitive, skills develop- worth acquiring. This effort should not only Employers’ Associa- tion after they arrive, ment should be in response to overseas de- be focused on unskilled labor, but should covering language, mand. One of the biggest challenges in labor also cater to professional and higher skilled culture, local customs, migration is skills recognition by the receiv- workers. For example, in an effort to move and immigration, labor and grievance procedure ing parties. Solutions to skills development, away from low-earning unskilled jobs, the laws, and skills train- therefore, include not only investment in Philippines is working towards opening ing—all tailored to the training but also in aligning training pro- higher-earning job markets in Europe, the EPS workers’ specific job sector. EPS workers grams to meet international standards and Americas, Australia and New Zealand by can also opt to move to ensuring that the acquired skills are recog- providing a skills registry and a global job another employer if they encounter mistreatment nized by prospective firms and employers. mapping and profiling program. and exploitative working This could be achieved by involving employ- conditions. Page 59 Indonesia’s Global Workers The government might consider introduc- be undertaken by the recruitment agencies ing a more stringent job-matching selec- (PPTKIS), evidence shows a relatively high tion and sorting process, particularly for turnover rate: nearly 20 percent of migrant low-skilled or semi-skilled workers. Many workers who signed job contracts later ter- labor-sending and recipient countries go to minated their contracts, while about 50 considerable lengths to select and sort work- percent of these terminated their contracts ers in order to optimize the mutual benefits due to work- or salary-related issues. This of labor migration—matching workers with suggests that the current PPTKIS job-match- the right skills to specific job order. In Indo- ing process is inefficient and the matching nesia’s case, it is unclear the extent to which outcomes are of poor quality. this happens. A role that should normally B Introducing modern information systems to improve transparency in the job market Migration needs to be an informed choice. level. This would be a major step forward Based on our survey data, 39 percent of in professionalizing the sector, allowing all migrant workers’ households are unaware stakeholders equal access to information of the basic requirements and documents and removing the potential for recruiters to needed to become a migrant worker. Mean- create monopolies on information. while, 42 percent of migrant workers’ house- holds are unaware of the potential risks in- Transparent information on job descrip- volved in working overseas. Furthermore, tions and qualification requirements would low-skilled migrants tend to leave the coun- also help aspirant migrants to better pre- try with little knowledge of their specific job pare themselves for future opportunities. descriptions, their rights, or even their wag- Such transparency would allow prospective es. This would suggest that the government’s migrant workers to pro-actively acquire skills traditional information campaign needs to that meet job opportunities, as opposed to be substantially improved if it is to have the relying only on training courses offered by desired effect on levels of awareness. PPTKIS for jobs where the specific qualifica- tions are unknown. One way of disseminat- Improving information transparency on ing information on job opportunities could overseas vacancies, particularly for low- take the advantage of high mobile phone skilled jobs, is a key pre-requisite for im- network penetration using easy-to-use ex- proving job-matching efficiency and con- isting application technologies, in addition tributes to lowering worker-paid migration to internet-based approaches. costs. Following on from the need for a new strategy for the dissemination of informa- Moreover, transparency on the wages of- tion, the limited access to information on fered would also help to level the informa- overseas employment opportunities is a tion playing field, as low-skilled migrants major barrier to international labor mobil- are currently not part of the wage bargain- ity and contributes towards high migration ing process. If wages were posted by firms costs. If job order information were pub- or employers, this would also reveal any ad- lished transparently and reached prospec- ditional fees charged for migration services. tive migrant workers, prospective migrants Surveys indicate that migrants in low-skilled could then select those jobs that they wish jobs often do not know what their wages are to apply for instead of being dependent on before and after deductions, or what the de- recruiters. An emphasis should be given ductions are for. This asymmetric informa- to low-skilled occupations, as many stud- tion creates an opportunity for PPTKIS to ies suggest abuses in recruitment are more make hidden deductions for recruitment prevalent among relatively lower-skilled mi- costs, or advance payments that migrant grant workers. The government could con- families are often required to make prior to sider using the new LTSA to play the role migration, especially for domestic workers. of the focal point for this effort at the local Page 60 Recommendations Developing and implementing a compre- benefit the most from it (Box 6.1). An effec- hensive information dissemination strat- tive communications strategy to dissemi- egy can therefore improve transparency nate information would be instrumental in and the functioning of the migrant labor helping to reduce undocumented migration market. A desirable strategy is one that by informing would-be migrants of the ben- makes use of diverse, conventional and new efits of documentation, alerting them to the approaches: creating a multi-media mix of risks of migration, especially undocument- print media, infographics, videos, social ed migration, protecting migrants through media, radio/television talk-show programs; greater awareness of their rights, respon- employing alternative types of messengers; sibilities, and mechanisms of redress, and broadening the target audience; and deliver- providing for greater accountability of pri- ing comprehensive key messages to ensure vate sector and government actors. that information reaches those who would C Improving the quality and accountability of recruitment agencies The government has already taken sever- To aid in enforcement, the government al steps to improve the quality of recruit- needs to publish detailed performance eval- ment agencies. Progress has been made in uations of the recruitment agencies to help improving the quality and performance of aspirant migrants to make informed choic- recruitment agencies. Several assessments es on which agency to use. A pilot study by have been conducted by the Ministry of J-PAL19 shows that migrant workers who 19 Abdul Latif Jameel Poverty Action Lab Manpower using strict criteria and these have full access to information and the abil- (J-PAL) conducted a have resulted in the sanctioning of several ity to choose good PPTKIS encounter fewer study on “Information Sharing Services” to PPTKIS, suggesting the system is improv- negative experiences once overseas, across assess the likely benefits ing. However, many poor quality PPTKIS all types of problems measured. These mi- of information sharing remain, and regular monitoring and strict grant workers also receive higher wages on services for migrant workers. This project is enforcement will continue to be required. average. This experience highlights the need conducted in 400 villages There is a tendency for sanctioned PPTKIS for an easily accessible nationwide informa- in eight districts consid- to either establish a new agency with the tion on PPTKIS for all prospective migrant ered to be main sending districts of female same owner and managers under a different workers. This should provide aspirant mi- migrant workers, with name, or to piggyback onto another PPTKIS, grants with greater information on both the 10,497 respondents. The results presented is from sharing the profits (IOM, 2010; Farbenblum PPTKIS available to them and their quality the pilot study. et al., 2013; Bazzi and Bintoro, 2015). Indone- ratings. sia could consider adopting a license-validity system similar to that used in the Philippines, where licenses are only valid for two years, although these can be upgraded to four years if certain stringent criteria are met. Page 61 Indonesia’s Global Workers Page 62 Recommendations PREPARING MIGRANTS BEFORE THEY LEAVE: 2 STREAMLINING THE DOCUMENTATION & PRE- DEPARTURE PROCESS Accelerating and streamlining the documentation process would help to reduce migration costs and subsequently lower undocumented migration. The official procedures to leave Indonesia for work can be long and complicated, as well as costly, and can push some peo- ple to choose to leave without following the formal documentation process. Several reforms can be undertaken to tackle this issue: simplifying the documents required, removing some unnecessary and overly bureaucratic stages of the process, and combining some of the stag- es (Box 6.1). Moreover, to lower documentation costs and make them more transparent, some components of the expenses that are regulated or standard, such as for obtaining a passport and the medical check-up, could be paid directly to the service provider instead of being included in the placement cost structure. Current government initiatives to make the documentation process simpler, faster and less costly, such as LTSA, should be continued and expanded. The government is making progress as, on average, documented migrant workers are now able to gain greater benefits than their undocumented peers, both financially and also in fulfilling their rights. The ef- fort to incentivize documented migration through the LTSA program holds great potential and needs to be expanded beyond the current four locations. Moreover, to be able to fully function as a one-stop-shop online non-cash-based system, each LTSA office should have the four components of the documented migration process involving civil registration, employment records, medical check-ups and immigration. Access to the KUR program should also be improved with more efficient loan-repayment mechanisms. In order to increase take-up of KUR by pre-departure migrant workers, its application process needs to be simpler and faster, and thus the intended beneficiaries could use the proposed credit in-time to cover their placement fees. In addition, the repayment obligations should be made automatic to make it a more efficient and transparent process, both for the banks and the recipients. Pre-departure briefings face several challenges and are in need of further improvement. Migrant workers who go through the official channel are required to join a pre-departure briefing (PAP). Survey data show that attending a PAP increases awareness on salary-re- lated and working-condition issues among migrants by an average of 16 percentage points. The incidence of knowledge about protection services—such as contact numbers of the Indonesian consulate or other emergency services in the destination countries—is twice as high among those who attend a PAP compared with those who do not. However, at least 20 percent of migrant workers who participate in PAPs fail to acquire the necessary informa- tion, raising questions over standardization of the PAPs and whether there is an adequate monitoring and evaluation system in place to ensure the effectiveness and quality of current PAPs. At only 8 to 10 hours’ duration over two days, the current PAP is too short to share information that ranges from the culture of destination countries, the contents of labor contracts, to managing remittances and health issues. It could be extended depending on the varied information needs of migrant workers, tailored to particular occupations and destinations. Moreover, PAPs and orientation could also be organized as a collaborative ef- fort with destination countries, as well as diaspora and returnee communities. For example, the International Organization for Migration (IOM), on behalf of the Italian government, has provided a language training course and pre-departure orientation for caregivers from Sri Lanka and Moldova bound for Italy. Page 64 Recommendations 3 PROTECTING MIGRANTS WHILE THEY ARE ABROAD: RAISING THE BAR ON PROTECTION A Bilateral agreements Bilateral agreements and consular ser- some important details covering placement vices can help to promote and protect and protection of migrant workers, such as migrant workers’ rights. Recent research wage and labor contract details, costs of by the World Bank KNOMAD and ILO20 migration, and other protection measures. shows that bilateral agreements between This can help to ensure the rights of migrant labor-sending countries and receiving coun- workers by addressing problems relating to tries can be an effective tool in promoting recruitment, wages, undocumented migra- and protecting the rights of migrant workers. tion, social security and abuse, among others. Bilateral agreements assign specific respon- sibilities and actions expected of both coun- The government could also be more proac- tries, and can create a legally binding under- tive in engaging in coalition-building with standing. Nonetheless, the same KNOMAD/ other migrant sending countries, as well ILO found that MoU are far more common as destination countries. Both sending and in Asia (69 percent) than the more legally receiving countries have a responsibility to binding bilateral agreements (72 percent ensure the protection of migrant workers in in African and 80 percent in Europe and accordance with the laws, regulations and the Americas), known as Memoranda of policies of the respective countries. As with Agreement (MoA). In Asia, the country of trade negotiations, Indonesia can gain from origin with the most bilateral agreements building a strong coalition with other (espe- is the Philippines, having agreements with cially neighboring) low-skilled labor-sending 18 countries. 21 countries in order to increase its bargain- ing power with labor-receiving countries, Indonesia, however, has no legally binding especially to ensure the equal treatment of bilateral agreements, only memoranda of migrant workers with their national counter- understanding. Unlike the Philippines, parts. Indonesia should also continue shar- Indonesia only has bilateral MoUs with ing information and lessons learned with destination countries. Since they only ex- other labor-sending and receiving countries press a convergence of will between the two through regional forums, such as the Abu parties, MoUs are less binding than MoAs Dhabi Dialogue, the Colombo Process or (ILO, 2013). Indonesia could negotiate bi- the Cebu Declaration. The key task of the lateral MoAs, instead of the MoUs that are government is to ensure that the provisions currently used, to carry more significant of the declaration are implemented both in commitments with destination countries. Indonesia and in the destination countries A good bilateral agreement should include (IOM, 2010a). 20 KNOMAD and the International Labour Organization, 2015. 21 Negotiating Bilateral Labor Agreements for B the Protection of Over- seas Filipino Workers: The Labor attachés & the Philippine Experience, Indonesian diaspora presentation, December 2015, Bali, Indonesia. 22 The main destination Indonesia should consider ramping up the recent positive moves to provide support to countries are Malaysia, use of labor attachés at Indonesian embas- migrant workers through Indonesian con- Hong Kong SAR, Singa- pore, Chinese Taipei, the sies and consulates in major destination sular services need to be increased. With Rep. of Korea, Brunei countries. Given the huge number of In- only 13 labor representatives covering the Darussalam, Saudi Ara- donesians now working overseas—roughly 12 main destination countries22, of which bia (Riyadh and Jeddah), Kuwait, Qatar, the UAE, 9.4 million workers in all—it is clear that the only four have diplomatic status (i.e., full Syria and Jordan. Page 65 Indonesia’s Global Workers labor attachés), the resources available for is an organization to integrate the Mexican offering support to migrant workers is still emigrant community in the United States. insufficient. The Philippines provides a The IME is an independent department un- best practice benchmark for the expansion der the Mexican Ministry of Foreign Affairs of consular services, with its Philippines and works through 56 consular offices across Overseas Labor Offices (POLO) that serve the US. The IME also delivers an array of as an extension of the Department of La- services besides language services, such as bor and Employment (DOLE) in protect- civic, health, education and financial ser- ing the rights and promoting the welfare of vices, to Mexican migrants in the US. The OFWs. Based on DOLE data, as of Decem- services are channeled through conferences, ber 2015, there were 36 POLO in Asia, the courses, healthcare stations, scholarships, Middle East, America and Europe, while 43 or distribution of educational materials. labor attachés were assigned to 30 POLO, Mexico mainly supports the integration of with welfare officers in the other six offices. undocumented and low-skilled migrants The POLO provides 24/7 services to migrant by helping them acquire legal status, and workers. The Philippines has also estab- by providing training and skills enhance- lished Overseas Filipino Resource Centers ment (Weinar, 2016). Another example of in countries with more than 20,000 OFWs. this practice is the Advisory Committee and the High Committee for Turkish Citizens One of the problems that can arise during Living Abroad, established by Turkey. The migration is that the language barrier may advisory committee is attached to the Min- lead to misunderstandings between mi- istry of State, with one-third of its members grant workers and employers. To tackle being Turkish citizens living abroad who are this problem, the government might con- part of the diaspora. The task of the advisory sider tapping into diaspora resources. The committee is to monitor the Turkish diaspo- government could cooperate with receiving ra’s obstacles in integration and report these countries to arrange migrant workers’ sup- to parliament. In addition, the Department port groups in which diaspora communities of Religious Affairs’ (Diyanet) offices in the could engage with migrant workers and pro- destination countries facilitate the integra- vide help on relevant issues. Such an initia- tion of Turkish migrant workers. tive was introduced by Mexico through the Institute of Mexicans Abroad (IME), which C Migrant workers’ insurance Indonesia had provided specifically de- required to cover uninsurable risks. Estab- signed insurance to migrant workers, but lishing the validity of insurance claims was the program had experienced significant also a major challenge, particularly for those challenges. According to the World Bank’s migrant workers who were victims of loss study on Indonesia Overseas Migrant Work- categorized as uninsurable risks, such as ear- ers’ Insurance (World Bank, 2016a), the mi- ly termination, physical abuse or sexual ha- grant workers’ insurance scheme encoun- rassment. There was also the issue of double tered problems on several levels, including: protection, and therefore double payment, a lack of coordination between the three by some migrant workers in certain cases. 23 23 For a more detailed agencies most closely involved, namely the discussion regarding mi- Ministry of Finance, the Ministry of Man- At the same time, there was a lack of a re- grant Indonesia workers’ insurance, read “Im- power and BNP2TKI; an overly complex and liable and integrated database on migrant proving Migrant Workers’ time-consuming process in making claims, workers’ insurance, despite the introduc- Protection: Review of the with little clarity on the risks covered and a tion of individual electronic identity cards Indonesian Overseas Mi- grant Workers’ Insurance failure to take the low literacy levels of many for migrants (World Bank, 2016a). These (Asuransi TKI), Workshop migrant workers into account; and design cards, called Elektronik Kartu Tenaga Ker- Edition. World Bank: Jakarta (World Bank, flaws whereby insurance companies are ja Luar Negeri, or e-KTKLN, should help to 2016a). Page 66 Recommendations identify where migrants work and their em- The biggest challenge is to provide cov- ployment status, as they provide informa- erage for migrant workers while they are tion on destination countries, recruitment overseas. Given that migrants are physically agencies, employers/business partners, in- outside Indonesia when they take up em- surance providers, and bank account and ployment, this will require specific arrange- placement details. However, the informa- ments between the two branches of BPJS tion often becomes outdated when migrants as the administrators, and the insurance change their jobs while abroad, unless they system providers of destination countries. voluntarily inform details of the change to This will therefore require social security the authorities. Furthermore, so far no as- administrators to have bilateral agreements sessment has been made to evaluate the ef- with destinations countries, as well as gov- fectiveness of this new initiative, which should ernment-to-government (G2G) MoUs that be an essential part of the design process. should consider the employers' capacity to pay contributions, the social security regula- With the advent of a mandatory National tions in each country, and how to coordinate Social Security System (SJSN) in Indonesia, benefits and contributions, as well as service migrant workers’ insurance has recently delivery and administration (e.g., Moldova’s been brought under this umbrella. The gov- agreement with Italy, Portugal or other re- ernment stakeholders, including the Minis- ceiving EU countries). try of Manpower, BNP2TKI, the Ministry of Foreign Affairs, the Financial Services Au- Designing the migrant workers’ insurance thority (Otoritas Jasa Keuangan, or OJK) and scheme for insurable risks should also be the National Social Security Council (Dewan made a priority to provide comprehensive Jaminan Sosial Nasional, or DJSN), have made protection. While the SJSN can only cover an agreement with the Social Security Admin- insurable risks, the number of incidents of 24 These nine aspects istration Agency (Badan Penyelenggara Jami- uninsurable risk events is substantial and are: (i) legislation; (ii) nan Sosial, or BPJS) for Employment and the cannot be ignored. It is therefore vital for coverage or membership; (iii) program (including BPJS for Health to integrate migrant workers’ the government to find a solution to ensure program design); (iv) insurance into the national scheme under the coverage of these risks. A top-up plan to asset and investment the SJSN. The idea is that, under the SJSN, cover uninsurable risks outside the SJSN, management; (v) finance and report- migrant workers should be covered from the such as covering early terminated, physical ing; (vi) institutions pre- to post-departure stages of migration, abuse and sexual harassment, should be ad- and governance; (vii) development of business while applying transparency, accountability, ministered by another government institu- processes and informa- and the nine aspects of the SJSN24 in its im- tion outside the BPJS. tion technology system plementation, to ensure the main responsi- support; (viii) public edu- cation or socialization; bilities and roles of each institution involved and (ix) monitoring and are clearly defined and agreed upon. evaluation. Page 67 Indonesia’s Global Workers Page 68 Recommendations AFTER MIGRANTS RETURN: SUSTAINING THE 4 BENEFITS OF THE MIGRATION EXPERIENCE & REMITTANCES Sustaining the benefits of labor migration should become an integral part of the overall process, requiring its own set of policies. The benefits that accrue from international labor migration cover a multitude of aspects, from the various skills acquired by working overseas, the broad life-enriching experience gained by migrants while living abroad beyond the routine of working and earning income, and the resulting remittances sent to family members to support their welfare and, if possible, for lon- ger-term investments in education, health and business capital. The government can play an important role in enabling a conducive environment that harnesses the development impact of migration and ensures that the impact of remittances is sustainable. The government should focus on creating an environment in which market participants generate more options for migrant households to save for their future. Remittances provide an opportunity for workers and their families to cover not only their short-term needs, but also to make longer-term investments. While consumption spending has a significant positive impact in reducing poverty, with various savings/investment opportunities available, migrants and their families can plan for longer-term investments, including small business start-ups, or higher education for children. Several countries have undertaken interesting initiatives to harness remittances for development (e.g., the Philippines and Sri Lanka), but more research is needed to understand how suitable such initiatives would be for Indonesia and, if suitable, how they might be best adapted to the Indonesian context. Policies are also needed to help returnees, especially women, to better reintegrate in the domestic economy to avoid dropping out of the labor force. While the share of returned migrants engaging in paid work increases compared with their activities prior to migration, and many returnees receive higher salaries than prior to migrating, almost half of female migrant workers become economically inactive after returning home. The government could play a more active role in supporting returning migrants, especially women, to enter the domestic labor force. This could start by finding out what the migrant workers aspire to do before they arrive home by conducting surveys on this issue during their employment overseas, for example to be carried out by a diaspora group. Other countries, such as the Philippines and Sri Lanka, actively assist migrant workers, especially women, to acquire entrepreneur- ial skills and financial literacy to help facilitate their re-entry into the domestic job market, although the effectiveness of these programs has yet to be fully assessed. Such international experience could be considered for piloting in Indonesia. Page 69 Indonesia’s Global Workers Page 70 Recommendations GOOD GOVERNANCE: REVISITING 5 INSTITUTIONAL ARRANGEMENTS & INTRODUCING BETTER MONITORING & EVALUATION Effective institutional arrangements are key to maximizing the benefits of migration by reducing the social and financial costs of migration. Current Law No. 39/2004, together with Minister of Manpower Decree No. 22/2014 that regulates the implementation of the law, stipulates that individuals have the right to work abroad and that the government’s role is to empower individuals, facilitate the outflow process, and protect their security during overseas employment. Successful implementation of these policies will require strong co- ordination across line ministries and other stakeholders involved in the management of Indonesian labor migration. Clarity in the roles and responsibilities of the national agencies responsible for the design and implementation of migration policies and programs is imperative to the success of the government’s reform efforts to streamline and harmonize labor migration process- es, reduce migration costs incurred by Indonesian workers and increase the benefits of migration for migrants and their families. Specific functions of institutions responsible for labor migration should preferably be stipulated in executive orders or other forms that specify implementing rules and regulations. Migration landscapes can frequently change, driven by unforeseen changes in external environments, or technological changes and innovations. Stipulating institutional functions and structures in law can create unneces- sary rigidity in institutional arrangements, hindering the government in achieving timely responses to newly developing issues. Indonesia would benefit from establishing a coordinating mechanism to inform the formulation of labor-migration policies. Since migration is a cross-sectoral issue, such a mechanism should consist of representatives from all the relevant ministries and agencies, as well as the private sector and civil society organizations to balance various concerns and interests. Deliberations by the coordinating mechanism should be underpinned by field data and rigorous analyses of policy implementations. Significant efficiency gains in the implementation of labor-migration policies can be real- ized by bringing the various functions currently being carried out by different institutions under the oversight of one ministry. The experiences of countries with a mature level of migration governance, such as Germany, the Rep. of Korea, and the Philippines, indicate that a single-lead-ministry approach appears to be the most effective in governing migration and enhancing coordination across relevant line ministries and agencies. Meanwhile, developing a monitoring and evaluation system would help to support evi- dence-based policy reforms. The current lack of an effective M&E framework limits the government’s ability to gauge whether policies and programs related to international mi- grants are working. 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Today, more than 4.79 million Indo- dotal information. The lack of rigorous and nesian have legally migrated to other coun- complete data on migration and remittances tries for job opportunities. The actual num- is one of the reasons behind the limited re- ber of Indonesian migrant workers working search and policy evaluation. Such data are overseas is estimated to be far higher since vital in informing the policy dialogues on many more migrate illegally. These migrant this important area. workers send billions of dollars back to In- donesia annually, unquestionably support- In order to fill these gaps, the World Bank, ing the country’s economic development. in close collaboration with BPS, conducted In 2016 alone, Bank Indonesia’s recorded the first ever complete nationwide survey in US$8.9 billion remittances from migrants, Indonesia on international migration and contributing a significant of 24 percent to remittances. The WB-IIMR Survey collected country’s balance of payments inflows from information on migration and remittances services and income. While migration on throughout all stages of migration: before, one hand has been seen as an opportunity during and after migration. The design and for Indonesia, on the other hand there are implementation of the WB-IIMR Survey was many concerns about the human rights of integrated to the National Socio-Economic Indonesian migrant workers as a result of Survey (Survei Sosial Ekonomi Nasional, or many cases of harassment and exploitation. Susenas), a nationwide household-level sur- vey regularly conducted by BPS to collect Despite the importance of international la- information at the household and individual bor migration in Indonesia, little research levels on consumption, demographics, em- has been undertaken to better understand ployment, education, housing conditions, the socioeconomic costs and benefits of and other socioeconomic indicators. Inte- migration, to what extent migration and grating the WB-IIMR Survey into Susenas remittances affect migrants’ households’ allows for comprehensive analysis of the development, as well as the country’s eco- characteristics and behaviors of migrant nomic development in general, and what workers’ households versus non-migrant would be the ideal migration policy for max- workers’ households, or between different imizing the benefits and reducing costs of areas of the country, province by province, international labor migration for Indonesia. or rural compared with urban. Existing research on international migra- Page 76 Annex Annex I.2. WB-IIMR The WB-IIMR Survey was implemented in grant workers’ households were conducted Survey Design two rounds, by piggy-backing it to Susenas using Susenas 2005-2007, data collection in the fourth quarter of 2013 and first quarter of 2014. The households The estimate using both Susenas and PO- selected for the WB-IIMR Survey therefore DES data showed 4 percent migrant work- followed the Susenas sampling frame for er households nationwide. This 4 percent those respective quarters. However, the ma- estimate was then used as the threshold to jor origins of international migrant workers select provinces and districts for the WB- are concentrated only in some, and not all, IIMR Survey. A province was selected in the areas of Indonesia. Given this phenomenon, survey if the estimated number of migrant the survey sample for the WB-IIMR Survey worker households in that province was not could not fully follow the Susenas sampling less than 4 percent. Similarly, within the se- frame if it was to ensure representativeness lected province, a district would be selected of the migrant workers captured in the sur- for the survey only if the estimated number vey while also remaining cost-effective. The of migrant worker households in that respec- WB-IIMR Survey therefore focused only tive district was not less than 4 percent with those areas considered to be pocket areas at least 10 households in it. By applying this of migrant workers. In order to understand approach, there were 104 districts within 15 the distribution of migrant workers’ house- provinces estimated to have a reasonable holds across areas of Indonesia, a prelimi- number of households with international nary analysis to estimate the number of mi- migrant workers (Figure A.I.1). Figure A.I.1 1. North Sumatra 6. West Java 11. West Nusa Tenggara The 15 selected provinces 2. Riau 7. Central Java 12. East Nusa Tenggara in the WB-IIMR Survey 3. Jambi 8. DI Yogyakarta 13. West Kalimantan 4. Lampung 9. East Java 14. South Sulawesi 5. Archipelagic Riau 10. Banten 15. Southeast Sulawesi 1 5 2 13 3 15 4 14 10 6 7 8 9 11 12 Page 77 Indonesia’s Global Workers Using this sampling method, it was estimat- Nonetheless, with purposively excluded ed that the WB-IIMR Survey would obtain non- or low-migrant worker districts in the around 2,000 migrant worker households in selected provinces from the survey, analysis each survey round from about 75,000 house- resulting from these survey data would not holds in the Susenas samples (assuming be able to represent the conditions of other that at least 96 percent of these household provinces, nor to describe the situation of samples could be surveyed). If this estimat- migrant workers and migrant households at ed numbers could be met, the WB-IIMR Sur- the national level. Rather, the findings from vey would represent more than 70 percent this survey represent conditions in the spe- of migrant worker households nationwide. cific concentrated areas of migrant workers Figure A.I.2 Quantitative survey of Indonesia’s International Migration and Remittances Survey Survey Sampling Survey Size implementation Instrument Coverage 4,660 migrant Piggy-backed All stages of 104 districts in workers (former to the National migration (before, 15 provinces and current Socio-Economic during, and after). considered to be migrants) from Survey (Susenas) in the main sending 3,940 migrant December 2013 and areas of Indonesian households March 2014. migrant workers. (representing around 70 percent of migrant households nationally). Annex I.3. WB-IIMR The questionnaire used in the WB-IIMR issues and concerns on international mi- Survey Survey consists of two sections. The first gration. Instrument section is the screening section and the sec- ond section is the migration and remittances • Consultations with relevant stakeholders section. The screening questions were asked and resource persons. Intensive discussions to every Susenas sample household in the and consultations to gather inputs were selected districts, in order to find out wheth- conducted between the World Bank team er there were household members who had and several stakeholders: BPS, BNP2TKI, previously become migrant workers (return- TNP2K, Bank Indonesia specifically on re- ing migrants) or former household members mittances, and the Ministry of Women’s who at the time of the survey were working Empowerment. Inputs and comments for overseas (current migrants). Households questionnaire design were also received having current or returning international from other teams within the World Bank (Fi- migrant workers were then interviewed us- nance and Markets, KNOMAD, and PNPM ing the second section of the questionnaire: Support Facility) that had worked on and/or the migration and remittances section. had knowledge of migration issues in Indo- nesia or other countries. A number of consultations and pilots were • Questionnaire testing. Two pilots were conducted during the development of the conducted to test the flow and interview questionnaires to ensure inclusion of key process of questions included in the ques- Page 78 Annex tionnaires. The first pilot was conducted To structurally capture conditions and ac- in Purwakarta (West Java), from which the tivities experienced by migrant workers findings were used to improve the question- throughout the whole stages of migration, naire tested later in the second pilot in Lom- the questionnaire is divided into sections bok (West Nusa Tenggara). Revisions and and arranged according to the sequence improvements to the questionnaire design of being an international migrant worker were also tested through trials involving a (Table A.I.1). It is started with questions number of returning migrants. from access to information before migra- • Workshops. Internal workshops with BPS tion, recruitment and placement process, and BNP2TKI were conducted to finalize followed by questions on type of work, wage the questionnaire and field manuals to con- rate, working conditions abroad, and chan- duct the survey. While BNP2TKI provided nel and usage of remittances. For return- necessary inputs and suggestions on the ing migrant workers, there are additional contents, BPS contributed expertise on the questions on labor market participation af- technical aspects of the survey. ter they returned from overseas. Table A.I.1 Location identification Questionnaire structure Filter question List for former and current migrant in the household Migrant worker’s individual information Prior to migration Reasons for working overseas Individual information prior to working overseas Recruitment process Job contract and type of job Migration costs During migration Salary and insurance The right for socialization and taking days- off Remittances Negative experiences Termination of job contract After migration Intention to work overseas again Impact of being a migrant worker Annex I.4. WB-IIMR Following the Susenas schedules, data col- households), followed by West Java (26 per- Survey Data lection for the WB-IIMR Survey was con- cent), Central Java (17 percent), West Nusa ducted in December 2013 (4Q13) and in Tenggara (13 percent), Lampung (4 percent), March 2014 (1Q14). The two rounds of data South Sulawesi (3 percent), West Kalimantan collection in the selected districts visited and East Nusa Tenggara (2 percent). around 35,350 Susenas sample households, of which about 11 percent, i.e., about 3,940 Within the 3,940 migrant worker house- households, reported having an international holds found in the survey, there are about migrant worker(s), either former or current. 4,660 individuals defined as migrant work- ers, with 2,200 individuals categorized as Across survey areas, the highest number of former/returned migrant workers and 2,460 migrant worker households is found in East individuals still actively working overseas Java (30 percent of total migrant worker (current migrant) during the survey time. Page 79 Indonesia’s Global Workers As presented in Annex I.4, the distribution percent), Lampung and South Sulawesi (4 of individual migrant workers follows the percent), West Kalimantan (3 percent), and distribution of household migrant workers East Nusa Tenggara (2 percent). Some basic where the highest percentage of migrant findings on migrant worker compositions workers are from East Java (31 percent), (by gender, current vs. former, and urban vs. followed by West Java (24 percent), Central rural) by province are also presented below Java (16 percent), West Nusa Tenggara (13 (Figure A.I.3 to Figure A.I.7). Figure A.I.3 lampung Quantitative survey of South Sulawesi a Indonesia’s International Jav 4 4 Migration and Remittances st We W es Banten tN East Nusa Tenggara us aT West Kalimantan en gg ar 13 a 24 East Java Cen tral Java 31 16 Source: World Bank International Migration and Remittances Survey 2013/2014. Page 80 Annex Figure A.I.4 West Nusa Tenggara 30 Proportion of migrant worker households by province (%) As % of total households in the province (only in selected districts) West kalimantan 18 Jambi West java East 13 13 Nusa Tenggara Central Java East Java 13 South 11 11 Sulawesi 11Southeast DI Sulawesi Lampung Yogjakarta 8 Banten 9 Riau 7 7 6 North Sumatera 5 1 Kep. Riau Source: World Bank International Migration and Remittance Survey 2013/2014. North Sumatera North Sumatera North Sumatera Page 81 Riau Riau Riau Figure A.I.7 Figure A.I.5 Figure A.I.6 Jambi Jambi Jambi workers by province (%) Composition of current and lampung lampung lampung area of origin by province (%) Gender composition of migrant Composition of migrant worker’s former migrants by province (%) Kep. Riau Kep. Riau Kep. Riau West Java West Java West Java Central Java Central Java Central Java Male Rural Urban Female Source: World Bank International Migration and Remittance Survey 2013/2014. DI Yogjakarta DI Yogjakarta DI Yogjakarta Former migrant Current migrant Indonesia’s Global Workers East Java East Java East Java Banten Banten Banten West Nusa Tenggara West Nusa Tenggara West Nusa Tenggara East Nusa Tenggara East Nusa Tenggara East Nusa Tenggara West kalimantan West kalimantan West kalimantan South Sulawesi South Sulawesi South Sulawesi Southeast Sulawesi Southeast Sulawesi Southeast Sulawesi 0 10 20 30 40 50 60 70 80 90 100 0 10 20 30 40 50 60 70 80 90 100 0 10 20 30 40 50 60 70 80 90 100 Page 82 Annex Annex II Steps to become a Documented Migrant Worker 01 Obtain information about how to be a documented migrant worker from office of manpower (Disnaker) or Office of Placement Services and Protection of Indonesian Migrant Workers (BP3TKI) Documentations for registration 02 Prepare ID card, birth certificate, 03 Prepare a permission letter from 04 Prepare a Job Seeker Registration and school diploma (persumably spouse/parent/guardian, verified Card issued by Disnaker already available) by the village head 05 Register as a prospective migrant 06 Attend the socialization on 07 Attend interest and skill selection worker at Disnaker office available job orders conducted by tests conducted by Disnaker Disnaker and PPTKIS (id the profile of prospective migrant worker fits the administration criteria of job orders) 08 Sign the Placement Agreement 09 Stay in the shelter owned by 10 Attend trainings, and receive a with PPTKIS (verified by Disnaker) PPTKIS (for prospective migrant certificate of attendance if pass the selection test workers in the informal sectors) 11 Attend competency test 12 Perform health test 13 Perform psychological test conducted by Professional Certifying Agency, and obtain a skill certificate 14 Apply for passport 15 Apply for work permit 16 Apply for visa 17 Apply for employment insurance, 18 Pay Labor Development Fund 19 Attend Pre-Departure Briefing (PAP) and obtain an insurance card 20 Sign a job contract 21 Receive a migrant worker ID card 22 Depart to destination country (KTKLN) issued by BNP2TKI